[HN Gopher] Figma and Adobe abandon proposed merger
___________________________________________________________________
Figma and Adobe abandon proposed merger
Author : supafastcoder
Score : 2071 points
Date : 2023-12-18 13:04 UTC (1 days ago)
(HTM) web link (www.figma.com)
(TXT) w3m dump (www.figma.com)
| supafastcoder wrote:
| Honestly, as a Figma user and fan, this is great news. For Figma
| employees probably not so much.
| saos wrote:
| They will go public and can unload then. It's an opportunity
| for figma to offer their customers early access to shares
| before IPO. Many of us will support them.
| stephen_g wrote:
| Yeah, I do feel a little bad for the employees with equity but
| honestly I'm really glad Adobe isn't allowed to buy it. I hope
| they find a much better company to sell to if that's what they
| want to do.
| samwillis wrote:
| There's a $1B fall through fee, I assume that gets paid to Figma
| now?
|
| I wander if that will make its way to early employees who were
| hoping for a liquidity event.
| smileysteve wrote:
| Perhaps it could make an IPO more likely instead? And that
| would make its way to early employees.
| mbauman wrote:
| I would expect that to only get paid if solely one side were
| responsible for blowing up the deal. This is expressly saying
| both have mutually agreed.
| eigenvalue wrote:
| Nope, from Adobe's 8K filed today with the SEC:
|
| "On December 17, 2023, the Company and Figma mutually agreed
| to terminate the Merger Agreement and entered into a mutual
| termination agreement effective as of such date (the
| "Termination Agreement"). The mutual termination of the
| Merger Agreement was approved by the Company's and Figma's
| respective Boards of Directors. In accordance with the terms
| of the Termination Agreement, the Company will make a cash
| payment to Figma in the previously agreed amount of one
| billion dollars ($1,000,000,000) (the "Termination Fee")
| within three business days following the date thereof. The
| Termination Fee is the sole and exclusive remedy under the
| Merger Agreement, and the Company and Figma have each waived
| any and all other claims in connection with the Merger
| Agreement and the transactions contemplated thereby."
| reustle wrote:
| > the Company will make a cash payment to Figma in the
| previously agreed amount of one billion dollars
| ($1,000,000,000) (the "Termination Fee") within three
| business days following the date thereof
|
| Three business days to wire $1b, the week before Christmas.
| That has to be a fun phone call with the bank.
| Ekaros wrote:
| I hope they have big bank... Then again it would also be
| funny if bank crashed because someone was forced to
| transfer 1 billion.
| eddiewithzato wrote:
| banks move so much more daily
| fauigerzigerk wrote:
| Indeed. Also, the money is probably coming out of some
| money market fund or from selling treasuries.
| Vicinity9635 wrote:
| I worked for Citigroup in ~2009. The project I worked on
| handled ~4.5 billion in trades a per day every day it
| ran.
|
| It wasn't that big of a project either...
| frankchn wrote:
| In October, FedWire moved $4.275 trillion USD per day on
| average.
| zymhan wrote:
| Yeah I'm sure Adobe is just using a single-branch bank
| tsunamifury wrote:
| How is this an issue? You can easily wire up to 999
| million with just a mobile device any work day.
|
| If you think im joking no I've designed it for major
| banks.
| TedDoesntTalk wrote:
| Might be technically possible from an app, but in the
| USA, the backoffice won't approve it without one-on-one
| interaction.
| JumpCrisscross wrote:
| > _in the USA, the backoffice won 't approve it without
| one-on-one interaction_
|
| For a business like Adobe, yes. They'll probably want a
| verification call. Plenty of funds, however, handle
| similarly-sized transactions with completely electronic
| verifications.
| tsunamifury wrote:
| Yea I mean how do people think large companies do things
| like payroll which is easily more than this monthly.
| TedDoesntTalk wrote:
| Payroll is done with ACH, not wire transfer. ACH is
| reversible so it has fewer controls. Wires are not
| (generally) reversable.
| tsunamifury wrote:
| Technical Protocol doesn't matter we're talking approval
| and liquidity here. ACH/Wire same dif.
| JumpCrisscross wrote:
| > _Payroll is done with ACH, not wire transfer_
|
| For large payrolls, it would be done over wire (between
| the employer and payroll processor). The employer has
| leverage and wants to keep the float.
| kasey_junk wrote:
| You'd have to be a _very_ large payroll to have leverage
| over adp.
|
| For many payroll operations between big employers and
| payroll processors it's an inner bank ledger transfer as
| the big payroll processors have good reason to maintain
| accounts at many banks.
|
| Vice versa is also true. If you have a very large payroll
| your treasury team is not put out by having accounts at
| lots of banks.
| JumpCrisscross wrote:
| > _it's an inner bank ledger transfer_
|
| This is common. But so are wires.
| bragr wrote:
| Sending a billion dollars is not the same thing as having
| a billion liquid dollars in one place to send. It is the
| difference between Accounts Payable and the Finance
| department of a company
| saghm wrote:
| I appreciate the insight from someone who has expertise
| in this area, but I think it's worth thinking about
| whether there are more constructive ways of phrasing
| this. Almost nobody who reads your comment will ever be
| in a position to "wire up to 999 million" at any point in
| their life, easily with just a mobile device or
| otherwise.
| microtherion wrote:
| Bank is going to have to dip deep into their swear jar to
| come up with the money.
| jzl wrote:
| Hah, reminds me of this:
|
| https://youtu.be/7C1Zaqu0wrw
| dubcanada wrote:
| Here is how it is going to go, Adobe will tell their
| accountant to wire the money, the accountant will get the
| details from Figma. Adobe accountant will call their bank
| or maybe even go in to the branch. And tell them they are
| sending X to X. It will take a few stamps and
| confirmation and it will be done in about 5 mins. Some
| computer somewhere will go - 1 billion Adobe and + 1
| billion Figma.
|
| On the bank side nothing really happens unless Figma
| decides it wants to withdrawal all 1 billion. Then X bank
| will owe Y bank money, that loan will be balanced at some
| point. It will probably take a few days so Figma will be
| told it needs a few days.
|
| Even if Figma decides to pay all their employees a share,
| that's also just - 50k Figma, + 50k Bob Smith in a
| computer somewhere.
|
| There is no actual exchange of money until stuff is
| balanced at some point or you withdrawal. It's all just
| 1s and 0s in a record.
| disiplus wrote:
| There is for sure exactly defined in the paperwork where
| the money will go in case of x.
|
| That was at least so when we sold our company.
| vl wrote:
| The problem here is not doing the transfer, but holding 1
| cool B in cash being ready to transfer. Even if it is in
| liquid assets, 3 days to liquidate 1B is quite short.
| M2Ys4U wrote:
| It wouldn't surprise me if the timing of the execution of
| the termination agreement was agreed for _after_ Adobe
| had liquidated assets.
| bombcar wrote:
| That's what lines of credit are for if needed. A company
| of Adobe's size should be able to obtain that easily
| (maybe even on a handshake).
|
| Their latest report with the SEC would indicate how much
| "cash" they regularly have on hand.
| iamleppert wrote:
| If I was the board I'd be calling for the CEO's head after
| loosing $1 billion for absolutely nothing.
| jefftk wrote:
| If the value of Figma has fallen by more than $1B since
| they signed the deal (which I think it probably has) then
| passing up $1B to get out of the deal is not nuts,
| especially considering the regulatory opposition. Though
| it depends more on whether the value of Figma _to Adobe_
| and _less the agreed acquisition cost_ has fallen below
| -$1B, since Adobe was presumably agreeing on a deal that
| they thought gave them significant surplus.
| mattmaroon wrote:
| It's a common term in these sorts of acquisition attempts
| now. AT&T paid T-mobile $3 billion.
|
| A failed acquisition attempt can be very damaging to the
| company being acquired. You can lose employees who don't
| want to work at the new entity that never happened. It
| can change your product roadmap (are you really going to
| invest in directions the acquirer won't want after
| completion?) and make your executive team start job
| hunting. Etc.
|
| So it's not unreasonable or uncommon for the acquirer to
| agree to such a provision. And the board was presumably
| highly involved in a large offer like that.
| asah wrote:
| not nothing: they got to examine Figma's books, IP/code,
| staff, etc where Figma got to see nothing about Adobe.
| JumpCrisscross wrote:
| > _If I was the board I'd be calling for the CEO's head
| after loosing $1 billion for absolutely nothing_
|
| The Board signed off on the deal. Given Adobe's stock is
| up for the day, I don't think shareholders are crying
| over this termination fee.
| whimsicalism wrote:
| investors probably figured this out on Dec 13, not today
| mattmaroon wrote:
| Are you implying the dip then was due to insider trading?
| That's a big charge.
| mbauman wrote:
| Wow, thanks for the reference!
| jay-barronville wrote:
| 1 billi and they didn't even have to give up any equity.
| I'm not a fan of the regulators screwing this deal the way
| they have (primarily due to the precedent they're setting),
| but in the grand scheme of things, methinks this is
| actually a great outcome for Figma. 15 months of hassle
| with $1B cash at the end, to be delivered within 3 business
| days.
| TedDoesntTalk wrote:
| Incredible that they have $1b sitting around in cash.
| Wouldn't you at least put it into a bond or treasury?
| GenerWork wrote:
| It probably is in a bond or treasury note. The "within 3
| days" probably covers the selling of the bond/treasury,
| waiting for the funds to clear, and then sending it over
| to Figma's account.
| vishnugupta wrote:
| Or transfer the bonds/treasury to Figma directly? Why go
| through the hoop when Figma too will just covert it to
| bond/treasury anyway?
|
| Is that allowed?
| bagels wrote:
| If Figma agrees that it satisfies the debt, why not?
| vasco wrote:
| Nothing that is public that I've seen says this is true.
| You can get a bridge loan for $1b backed by whatever
| iliquid assets you have from any major bank, and then
| it's up to you how quickly you want to unwind other
| things. The loan might even be interest free if the bank
| wants to keep Adobe's business for other M&A activities.
| TedDoesntTalk wrote:
| Bridge loan with $1b liquidity in 4 days? Or are bridge
| loans essentially open lines of credit?
| vasco wrote:
| I used the term bridge loan as a sort of umbrella term
| that might be technically not the best as my training
| isn't in finance and I know some of this stuff from
| exposure by proximity. What I'm referring to sometimes is
| also called a revolving line of credit, the most famous
| case was Enron's revolvers for example. The point is big
| banks will normally allow companies to take out large
| short term loans for this type of thing, usually having
| large amounts pre-approved.
| bombcar wrote:
| VISA moves .66 billion transactions a day. If each is
| only a bit over a dollar they move a similar volume.
|
| Banks can handle this. But probably not for free.
| garbageman wrote:
| Typically they keep enough for business activities as
| cash and the rest go into cash equivalent / money market
| type things that earn some interest.
| eigenvalue wrote:
| I'm sure a company as big as Adobe has multiple billions
| in capacity on revolving lines of credit at attractive
| rates from a syndicate of top banks. They do have cash
| and short term investments of close to $8b to borrow
| against!
| samwillis wrote:
| There seems to be multiple references to the fee being
| payable if the deal falls through due to regulatory issue.
|
| _" He also noted that the original terms call for Adobe to
| pay a $1 billion break-up fee even if the deal falls through
| over regulatory issues."_
|
| https://www.barrons.com/articles/adobe-stock-figma-
| acquisiti...
| jonplackett wrote:
| I don't even use Figma, but I a glad Adobe won't be owning them.
| Erratic6576 wrote:
| Yeah I miss Adobe Lightroom but you don't get to install it,
| adobe takes over your computer
| vr46 wrote:
| It's total madness, isn't it. Long time user, from 1-5, then
| everything fell apart with CC, subscriptions and the
| clusterfuck of shite installed on my Mac.
| airstrike wrote:
| _> then everything fell apart with CC, subscriptions and
| the clusterfuck of shite installed on my Mac_
|
| except it also made Adobe more valuable than it ever was
| before and pretty much jump-started the ARR / SaaS
| valuation model that defines Tech today, so it's not ever
| going away
| jq-r wrote:
| I'm in the same boat. A very long time user and I really
| liked everything about it. When they started pulling that
| subscription shit with tons of crapware I had enough.
| Cancelling subscription (even a short one) was also a
| terrible (I would even call it criminal) experience. Tried
| couple of alternatives, and frankly I don't like them. They
| are either slow, got abandoned in a year or have
| unintuitive workflows.
|
| I would even pay $500 for a LR Classic without all of their
| other crapware, but they just like that too much to take my
| money.
| macintux wrote:
| Pixelmator/Photomator is an interesting alternative with
| robust software for both Mac and iPad. I'm a bit too fond
| of Photoshop layers right now, but I'm tempted to switch.
| cesaref wrote:
| Confronted with the same sort of problem, I ended up with
| Capture One and couldn't be happier. There are other
| options out there, which you should definitely explore.
| vault wrote:
| I bought the Affinity Suite during Black Friday, just to
| have some decent software on mac to do some editing. I'm
| far from a professional though and I have no idea how
| good their software actually is.
| vr46 wrote:
| I found a loophole - check my older comments - to let me
| get out of their system, but they may have closed it. I
| bought Affinity for a laugh but switched to Capture One
| for better skin tones, Photo Mechanic Plus for better
| management. Both those have gone to the terrible
| subscription model but I'm just going to freeze my Mac's
| OS where it is and have a reliable machine for this.
| Erratic6576 wrote:
| I'm installing mojave on my 2017 macOS and call it a
| "black pearl"
| politelemon wrote:
| Same, I miss the ownership of my photos and photographic
| workflows from the older lightroom days. It's sad that the
| industry rolled over to accept this and it trickled to the
| consumers.
| srvmshr wrote:
| This part is so true. Adobe under-the-hood SWE feels so
| shoddy. It feels as if their products, although delivering
| the good, is strung up by different patchworks. And it spawns
| files & folders all over your system
| klabb3 wrote:
| I tried the subscription for Lightroom CC and left my
| computer on at night to sync my meager 50-100GB to their
| cloud clusterfuck. Trial period ended after 2 weeks and the
| sync hadn't finished - and no it wasn't an issue with my
| bandwidth.
|
| Yeah..
| madeofpalk wrote:
| Excellent news. I think there should be more products, more
| companies, and more competition. Adobe just buying up it's
| competition will only ever directly hurt consumers.
|
| See also, "Adobe says the FTC is looking into its subscription
| cancellation practices."
| https://www.theverge.com/2023/12/15/24003532/adobe-says-the-...
| dkyc wrote:
| Except outlawing acquisitions by larger tech companies will
| absolutely reduce funding and incentives to start companies,
| and result in less products, less companies, and less
| competition.
| kwertyoowiyop wrote:
| This is so far from outlawing. And we are soooooo far from
| having a shortage of tech startups.
| robertlagrant wrote:
| > This is so far from outlawing
|
| It's not that far. A bureaucrat will decide if you can exit
| the way you want to. Still want to fund this venture?
|
| > And we are soooooo far from having a shortage of tech
| startups.
|
| Because there hasn't been a fear of them blocking exits.
| airstrike wrote:
| > A bureaucrat will decide if you can exit the way you
| want to.
|
| It's not up to the bureaucrat but to the courts. The FTC
| doesn't "approve" or "reject" deals--it can just take
| legal action to try to stop a deal, but that still gets
| adjudicated either in a federal court or in an FTC
| administrative law court to a judge which is appointed
| independently.
|
| https://www.ftc.gov/enforcement/merger-review
|
| https://www.ftc.gov/legal-library/browse/administrative-
| law-...
| matthewowen wrote:
| True in the US, not true in the UK or EU.
| airstrike wrote:
| Fair, I'm not as familiar with the UK/EU regulatory
| environment
| peyton wrote:
| That's who's blocking the sale according to Adobe's press
| release: https://news.adobe.com/news/news-
| details/2023/Adobe-and-Figm...
|
| Depending on specifics, the EU stopping blockbuster
| acquisitions in the US startup ecosystem feels ripe for
| abuse.
| airstrike wrote:
| I can assure you the EU isn't blocking this to prevent US
| founders from making money
| evrydayhustling wrote:
| Adding a legal battle with the FTC to the cost of any
| acquisition can chill and kill otherwise obvious deals,
| and or sap value out of those that push through.
|
| FWIW, I think there are good reasons to limit tech
| consolidation, including this one. But anyone should
| realize that it will reshape the industry in
| unpredictable ways, including some that harm "real"
| consumers and builders.
| airstrike wrote:
| But anti-trust isn't being _invented_ now. It 's always
| existed. Companies already factor in anti-trust risk when
| doing M&A--it's just hard to quantify the expected value
| of that risk
|
| If anything, IMHO, we've been too lenient with anti-trust
| in Tech in particular over the past 5-10 years. This just
| dials things back a little, and makes it so that "hard to
| quantify" risk is a little more likely than it was
| before, and certainly a little more likely than zero
|
| I don't think Adobe / Figma specifically is an "otherwise
| obvious deal" precisely because it has such obvious anti-
| trust risk. The fact that this merger was even announced
| is all the proof I need that we were being too lenient.
| Figma can still sell to any number of huge Tech companies
| peyton wrote:
| Published guidance is the correct tool. Blocking
| acquisitions doesn't really decrease uncertainty.
| airstrike wrote:
| The guidance already exists. Don't buy your biggest
| competitor, unless you're but one player in a diversified
| sector.
|
| Blocking acquisitions creates precedents.
| ethanbond wrote:
| What's net new about this? It has been the case for
| decades that if you try to sell to the only major
| competitor that it could be blocked under antitrust.
| Drakim wrote:
| A bureaucrat also decides the amount of lead you can put
| in your product and sell.
|
| In fact, there are all kinds of things you can't
| arbitrarily do because it hurts consumers, both
| physically and financially. This includes strengthening
| industry monopolies which has time and time again
| demonstrated that it causes incredible harm to entire
| segments of society.
| robertlagrant wrote:
| > This includes strengthening industry monopolies which
| has time and time again demonstrated that it causes
| incredible harm to entire segments of society
|
| I don't think you can take a hypothetical worst case and
| make it apply here. You could also say that we shouldn't
| have governments, because look at WW2 and all the war
| they declared.
|
| Adobe buying Figma wouldn't cause incredible harm to
| entire segments of society. It's barely even a monopoly,
| in that Adobe doesn't really do what Figma does already,
| and there is incredible potential in just making another
| Figma competitor if Adobe ruins Figma.
| passwordoops wrote:
| Or, and this is a crazy idea I know, maybe start a
| company with the notion that it will be a profitable,
| long-term success instead of a lottery ticket
| zztop44 wrote:
| I'm pretty sure no VCs are kicking themselves for having
| invested in Figma.
| maxehmookau wrote:
| This isn't that though. This is a company with a clear
| monopoly trying to hoover up smaller competition to reduce
| competition. We shouldn't incentivise this behaviour, on
| either end.
|
| If this is the liquidity event that Figma were betting on
| from day 1 that's their mistake for not foreseeing regulators
| being unhappy about it.
| DaiPlusPlus wrote:
| I'm fine with _some other_ company buying-up Figma, just not
| Adobe. Microsoft could buy them (and hopefully not repeat
| what happened to Expression Blend) - or maybe Alludo could
| resurrect the Corel brand and launch Figma under that title?
| dkyc wrote:
| The reality is that for extremely high-growth companies
| such as Figma, only companies with an extremely strong
| existing business _and_ strategic fit can afford to acquire
| them. Corel, for example, was valued at $1bn in their 2019
| acquisition. There 's absolutely no way they could acquire
| Figma. At the same time, VCs are betting on Figma-like
| outsized exits for their model work.
|
| I get people are dying to stick it to the big tech cos, but
| the reality is that the long-term effect of actions like
| this is reduced funding and less new, disruptive companies
| - and _strengthening_ the situation for the cash-rich
| behemoths like Microsoft, Google, etc.
| tonyedgecombe wrote:
| They couldn't acquire Figma for $20 billion but that
| doesn't mean Figma isn't acquirable. It just means the
| founders and investors get a bit less.
|
| > and strengthening the situation for the cash-rich
| behemoths like Microsoft, Google, etc.
|
| It certainly isn't good for Adobe as they will have a
| strong competitor in Figma to deal with.
| DaiPlusPlus wrote:
| > It certainly isn't good for Adobe
|
| It is good for Adobe: they'll be forced to make their
| products better.
|
| ...I hope!
| tonyedgecombe wrote:
| >It is good for Adobe: they'll be forced to make their
| products bette
|
| Which they thought was harder than spending $20 billion
| acquiring a competitor.
| xbar wrote:
| Maybe it would be more accurate to say that they that
| there is no way for them to make a product that will
| steal Figma's market for less than $20 billion.
|
| Adobe's despised reputation in business practices makes
| it hard for users to choose Adobe when any other creative
| option when it is available.
| delecti wrote:
| That would certainly be good for Adobe's _users_ , but it
| means they'll have to put in a lot of work, which costs
| money that could otherwise buy so many yachts.
| sp332 wrote:
| How would Figma be disruptive or weakening tech giants if
| their plan is to be acquired by them?
| dkyc wrote:
| Clearly Figma is providing a valuable product to the
| market. In part visible here by how people celebrate this
| decision. But people are celebrating Figma's continued
| independence without understanding that without the
| _possibility_ of being acquired for a large amount of
| money, the funding and incentive situation that
| _resulted_ in the beloved independent Figma wouldn 't
| exist.
|
| This is not as much about Figma, which is big already and
| will be fine, but the 100 other potential Figmas that
| might not even been started yet. They will have more
| difficulty finding funding, attracting employees with
| equity, etc., when the scenario 'big tech co acquires
| company for lots of $' doesn't exist anymore.
|
| Why would anyone go worth at a small company for equity
| if there's no chance to get liquidity? Why would
| investors invest? This decision might improve the short-
| term situation of the market, but over the long-term, I
| can only see how it benefits the big companies, which
| rely on today's cashflows / RSUs to attract people.
| krisoft wrote:
| > beloved independent Figma wouldn't exist.
|
| Are you saying that the business of "we make a thing and
| we ask for money from our users for said thing" model
| cannot work?
|
| > Why would anyone go worth at a small company for equity
| if there's no chance to get liquidity? Why would
| investors invest?
|
| Presumably because they hope the company become
| successful and it sells many licences and they get a
| share from that pile of money.
| dkyc wrote:
| > Are you saying that the business of "we make a thing
| and we ask for money from our users for said thing" model
| cannot work?
|
| I'm saying that companies like Figma, which has raised
| $333 million dollars in venture capital, at up to a $10bn
| valuation, cannot exist if those investors don't see
| sufficient options for liquidity.
|
| And given that people strongly value companies like
| Figma, as evident in this very thread, that would be a
| bad outcome all in all. The only market participants for
| whom this wouldn't be a bad outcomes would be big,
| established businesses that have to fear less startup
| competition.
| krisoft wrote:
| > And given that people strongly value companies like
| Figma, as evident in this very thread, that would be a
| bad outcome all in all.
|
| We value Figma the product. I couldn't care less about
| how much money they raised.
|
| This is why I'm asking if you think it is impossible to
| make a Figma like product financed from you know the
| users paying for that product.
| dkyc wrote:
| "I value Figma the product, I couldn't care less about
| how much money they raised" is an argument like "My power
| comes out the socket, so I couldn't care less about
| building power plants". It's hard to have one without the
| other. Figma the product was built with the the money
| they raised.
| krisoft wrote:
| > Figma the product was built with the the money they
| raised.
|
| Ok. But do you think that is the only way it could have
| been built? Somehow you are sidestepping that question.
| delusional wrote:
| I think the "disruption" narrative has played itself out
| by now. Nothing has been disrupted. Society still largely
| functions the same way as it did 20 years ago, and the
| same firms are mostly still running the same businesses.
|
| We were promised a radical new world, what we got was a
| couple of apps for fast food delivery from McDonald's.
| throwaway2037 wrote:
| Hmm... I struggle with your post. What about AMD vs
| Intel? Or TSMC / Samsung vs Intel? Intel is far weaker
| that it was 20 years ago, and chips are cheaper
| (inflation adjusted) and _WAY_ faster 20 years later. Is
| that not a win? I feel like desktop computing is
| basically flying cars at this point. For 1500 USD, you
| can get 5GHz CPU, 32 GB RAM, 2 TB NVMe drive, reasonable
| GPU that is utterly light speed compared to 20 years ago.
| The first time I ever used an NVMe drive, I literally
| thought the Linux commands were not running correct
| because they finished so quickly!
|
| Last one: I promise that I am not trolling here: What
| about psuedo-self-driving that Tesla and a few others
| have in cars now? On an expressway, it is pretty amazing
| -- hands off the wheel, talk with your friends with no
| worries of distraction.
| chongli wrote:
| I think the person you're replying to was referring to
| the post-smartphone startup era. All those hardware
| companies you mentioned are older than dirt. None of them
| qualify as "disruptive, VC-backed startups" like Figma,
| Uber, or Airbnb.
| vinyl7 wrote:
| Back in the olden days before the free-money-zero-
| interest rate policy, companies subsisted on selling
| their product, not their company.
| dylan604 wrote:
| I'm fine with some other company that has a track record of
| doing bad things to the things they've purchased, which is
| no different than the company I'm against buying this
| company.
|
| How are you okay with MSFT? The logic is not very sound
| toyg wrote:
| I guess the parent's point was that it's better for Figma
| to be acquired by a company that clearly has a Figma-
| shaped hole in their lineup, rather than someone with a
| lot of existing overlap that will likely just strangle it
| quietly in the night.
| dylan604 wrote:
| with a company infamous for "Embrace, extend, and
| extinguish", I wouldn't trust MSFT to recognize a hole
| needs to be filled.
| toyg wrote:
| TBF, they kept Skype, GitHub, and Minecraft, running
| fairly well - one can disagree on the features, but they
| did get continuous development and support, they weren't
| just "deprecated" and sunset like, say, Yahoo would do.
| DaiPlusPlus wrote:
| Microsoft has changed a lot since the late-1990s, really.
| madeofpalk wrote:
| I think this is net-negative for consumers, in a pretty
| significant way. If the most incentivised lifecycle is to
| seek VC investment to make a non-susitainable product in the
| hope of being acquired and swallowed into The Borg and shut
| down, we still end up with less good products.
|
| - Product life-cycles become short, consumers are weary of
| anything new. How many times have you seen product launches
| here on HN where the top comments are worrying about
| sustainability? That either there will be a rug-pull for
| consumers in the future, or they just plan to be acquired and
| shut down.
|
| - Larger companies continue to have no incentive to actually
| improve their product and compete with others if they just
| purchase everything in the market.
| Pet_Ant wrote:
| > If the most incentivised lifecycle is to seek VC
| investment to make a non-susitainable product in the hope
| of being acquired and swallowed into The Borg and shut
| down, we still end up with less good products.
|
| "Aim for the moon so if you miss you still end up amongst
| the stars."
|
| The actual _goal_ is to be an independent successful
| company, but getting bought is the back up option that
| provides a safety net. If it was success-or-bust (no "-or-
| get-bought") the risk calculus would not make it worth it.
| It would make the American economy much more conservative
| and much more like Europe.
| floren wrote:
| But when the most common business plan is "1. Spend VC
| millions, 2. Acquire non-paying customers, 3. ???, 4.
| Profit!" it kinda seems like the un-written step 3 is
| "get acquired by a MAGMA company". You just _say_
| something like "oh, we'll get revenue by adding
| advertising / premium accounts later" as a fig-leaf for
| the public.
| brendoelfrendo wrote:
| If your only goal in founding a company is to get acquired,
| you haven't made a company; you've made a product, and
| probably not a profitable one.
|
| We should be encouraging way more medium-sized companies,
| that operate sustainable business models, make money for
| their founders and employees, and aren't subsidized by cheap
| money. I think if startups actually had to sustain themselves
| we'd see a lot less grift and waste in VC.
| jen20 wrote:
| I don't disagree with the notion that there should be more
| medium sized, self sustaining ("lifestyle?") companies, but
| such statements are rarely if ever followed up with _why_
| this is a desirable outcome for everyone involved.
| graphe wrote:
| Or no lifestyle companies. What would be the harm without
| them?
| brendoelfrendo wrote:
| I guess it comes back to how you view the current system.
| If you find the idea of unicorns and acquisitions and the
| further centralization of capital distasteful, it's kind
| of self-evident why you'd want to see something that
| represents a break from that norm.
|
| For me, yes, I see the obvious argument that more money
| leads to more (and faster) innovation. But it can also
| result in an economy that is too tightly coupled and
| dependent on the might of a few massive companies,
| whereas an economy that is distributed across more
| smaller businesses is more robust.
|
| At the extreme, you might imagine South Korea: a country
| that is highly consolidated into one or two major cities
| and propped up by massive, economy-shaping corporations.
| I don't think anyone would disagree that Korea made
| massive economic strides in a short period of time, but I
| think there's much more debate about the long-term health
| of the Korean economy and people now that their continued
| prosperity is so centralized.
|
| And, of course, there's the consumer angle; though I
| can't claim any scientific methodology, my impression of
| the sentiments surrounding this merger are that it was
| pretty popular with Figma's investors and employees
| (understandably so, as they stood to gain from the
| merger), but was deeply unpopular with their customers.
| You could make the argument that "a Figma owned by Adobe
| is better than no Figma at all," but consumers have seen
| it all before at this point: a good product is acquired,
| and then either a) the pricing model changes, b) the rate
| of innovation slows down, c) the product is ultimately
| abandoned somewhere down the line, etc, etc. None of
| these outcomes are essential truths, but they are common
| outcomes of companies getting larger and larger to the
| point where a business unit that is otherwise healthy is
| deprioritized because it is not profitable _enough_ or
| growing _fast enough_ for the larger parent to care; or,
| conversely, the smaller parts suffer because the larger
| parent encounters trouble and can no longer sustain their
| acquisitions, even if they are keeping the bloat afloat.
| whatisthiseven wrote:
| I think it's fine if no one starts vampiric companies that
| dump free services on the public destroying the perceived
| value of software for the purpose of a fast unicorn exit. Of
| course, these companies always look to advertising for
| funding so they are obtrusive.
|
| Unless you are thinking of real companies that would be
| affected by this ban? Retail stores don't care about this
| ban. Companies that sell real products wouldn't care. If they
| sell real software services and plan to turn a positive
| profit rather than exit this wouldn't impact anyone other
| than unicorn chasers, which are bad for everyone.
| matthewowen wrote:
| But Figma isn't a vampiric company dumping free services
| for the purpose of a fast exit. It's been around for over a
| decade and charges _more_ for its principal product than
| Adobe charges for comparable products.
|
| So by your own definition, real companies are affected by
| this!
| ivan_gammel wrote:
| The company will probably do well for the reasons you
| mentioned, only some late shareholders are affected. A
| good exit for the economy would be actually an IPO.
| Lutger wrote:
| I didn't know Figma was going bankrupt, is it?
| matthewowen wrote:
| I don't see the relevance of that question: outcomes for
| companies fall onto positivity/negativity ranges beyond
| merely a bankrupt / not bankrupt bjnary.
| whatisthiseven wrote:
| I'm also ok with mega corps not buying smaller companies.
| It encourages further mega-corpification.
| piva00 wrote:
| Acquisitions also reduce competition. If competition only
| exists to be acquired you are only funding an ever-growing
| oligopoly, the more acquisitions into the oligopoly the more
| power they have, diminishing the number of available markets
| to compete in (since one of the oligopolistic companies will
| certainly have more capital than a newcomer).
|
| Anti-trust is not a new thing, it's even considered a
| foundational aspect of competitive capitalism by some
| thinkers...
| bayindirh wrote:
| I think it's the opposite. Because many companies start with
| the dream of an exit with a high price tag, and what they end
| up developing is a missing feature from a bigger software
| suite, which is already enshittified by a big software house
| to the core.
|
| Instead, smaller companies can start and slowly get bigger
| while getting bigger. Affinity suite is a great example.
| While their photo tool is not my cup of tea, designer is
| great, IMHO.
| 34679 wrote:
| I doubt that is true.
|
| Let's say you're pitching your startup to a potential
| investor. Would you pitch it as "the next Adobe" or
| "something Adobe might want to buy"? Which one would you be
| more likely to invest in?
| andsoitis wrote:
| > pitch it as "the next Adobe" or "something Adobe might
| want to buy"? Which one would you be more likely to invest
| in?
|
| I get your point, but that is not really the right framing
| because that is not how to pitch your startup.
|
| Tell me what it does, what its long term vision is, how and
| by when you'll make money, what's your moat, how you will
| grow.
| michaelcampbell wrote:
| Just like when there WERE no megacorps to buy smaller
| companies and we were left with none at all.
| benterix wrote:
| Yeah, I get it, some founders start their startup motivated
| by a potential MA. And this is great for them.
|
| However, as a customer, I absolutely hate this. Instead of
| finding a way to actually make the product/service self-
| sustainable, they just increase the number of (usually) free
| users. But once they sell, normally the new owner either
| shuts the service down or turns it into crap.
| coldpie wrote:
| Yeah. Keybase was the one that really showed this model to
| me, and soured me on the whole startup scene. What a crap
| way that is to run a business.
| afavour wrote:
| Agreed. I think if you're passionate about an idea then you
| should be able to channel that energy into making it a
| sustainable business. If you can't motivate yourself to do
| that... maybe let someone else who _is_ motivated do it.
| chongli wrote:
| It's a personality thing. The type of person who starts
| companies tends to start a lot of them. The idea of
| sticking around at a company and keeping a steady hand on
| the tiller (after all the big product problems have been
| solved) is anathema to these folks. What they need is a
| succession plan.
|
| It just happened that mergers and acquisitions turned out
| to be the cleanest, easiest way for founders to hand over
| the reins. In days past, companies would go through this
| transition process internally, often by succession through
| the founder's family. The founder may have been a very
| entrepreneurial type, but the child who was raised to be
| the successor was more of a managerial type. When it worked
| out, anyway. Sometimes none of the founder's kids were
| suitable. Or the founder tapped the wrong kid to take over.
| monkey_monkey wrote:
| Tech acquisitions haven't been outlawed. And this particular
| situation is applicable to perhaps 2 or 3 a year (all of
| which are multi-billion dollar values).
|
| I doubt very much if this will stop funding of new companies
| except perhaps at the level of Uber/WeWork.
| Ckirby wrote:
| "Oh no!, this hampers my ability to harm industry competition
| and hurt society, this isn't fair!"
|
| How about you go and fling yourself in front of a bus
| bilekas wrote:
| I agree to be honest, I do find it refreshing too that they're
| both Willing to part ways instead of trying to manipulate the
| system. I don't think this could just customers but even the
| companies themselves I don't see a loss.
| andybak wrote:
| Maybe they failed to find a way round the rules? That seems
| more likely than a spontaneous desire to "do the right
| thing".
| popcorncowboy wrote:
| This genuinely made me laugh thank you. But no, they're not
| refreshingly "willing to part ways", just that their
| extensive legal teams assessed every possible angle to force
| this through and the big chairs made a call that proceeding
| in the face of such harsh opposition was going to be too
| costly.
| j4yav wrote:
| It is refreshing that they weren't able to get away with it,
| anyway.
| vikramkr wrote:
| They themselves said they spent 15 months trying to
| manipulate the system and are only doing this because they
| failed, let's not be naive about them doing this out of the
| goodness of their hearts lol
| eviks wrote:
| They were trying to manipulate the system, just failed at
| that
| noirscape wrote:
| Adobes cancellation practices are literally illegal in the
| Netherlands by the way. The deceptive trick of "pay monthly for
| a full year" and then hitting you with the cancellation fee is
| against local law. (It's called de wet van Dam for the
| curious.)
|
| You have to threaten their customer support with legal
| complaints to make them comply with it, it's super frustrating
| to deal with. They do fold immediately when you do this though,
| so they know it's illegal but hope the frustration of getting
| through customer support will deter people (and avoids the
| legal problems).
|
| And yes I know you can just switch subscriptions and use the
| early cancellation period there to avoid the hit back fee from
| cancelling. It's the principle that's scummy.
| thelittleone wrote:
| I recommend using virtual credit cards for subscriptions. I
| just cancel the card if the account cancellation process is
| hostile in anyway.
| Perz1val wrote:
| What's the best way to acquire those?
| leshenka wrote:
| The bank's smartphone app?
| ativzzz wrote:
| Not all banks have these unfortunately, even though one
| time virtual cards should really be the standard for all
| online purchases
| leshenka wrote:
| Yeah, sadly. But really it's the best way to do virtual
| cards.
|
| If a bank doesn't offer these, next best thing is to go
| to the bank that does.
| Naracion wrote:
| If you're in the US, then I can recommend privacy.com
|
| My current bank (Wise) also offers virtual debit cards. I
| am in the UK now and Wise works well. I still use both
| since I still have my American bank account though.
| thelittleone wrote:
| I use Mercury as I expense most subscriptions for
| business.
| jann wrote:
| Being on the receiving side of that can be very
| frustrating. Even though users can cancel easily and
| without any human interaction, they cancel their credit
| card which then costs us multiple months of revenue in
| cancellation fees.
| tomashubelbauer wrote:
| Which is why I'd not do it to a small company with a
| clean cancellation process and also why it is a good
| thing to do it to Adobe (multiple times a day ideally).
| nolok wrote:
| In Europe just cancel your credit card authorization at the
| bank, or your SEPA mandate, or your PayPal authorization,
| depending on.
|
| They will try to scare you and ultimately won't go after
| you because the legality of this for b2c is very very iffy
| (because of the way they present the information on the
| sale page, which doesn't meet any informed consent level
| required). At least in my country, apparently in NL too,
| and if it ever got to the European level it would be
| smashed easily.
| Dayshine wrote:
| Why do people keep recommending this? If you do this the
| next step they take is sending your debt to collections,
| and now you have either ruined credit or a court case.
| Zenul_Abidin wrote:
| A virtual _debit_ card should prevent collections from
| getting involved though, since there 's literally no
| debt.
| charcircuit wrote:
| >hitting you with the cancellation fee is against local law.
| (It's called de wet van Dam for the curious.)
|
| I doubt this. The early termination fee is 50% what you were
| obligated to pay. If Adobe got rid of this than consumers
| would have to pay 100% of this. De wet van Dam is about the
| about not being able to cancel the subscription itself and
| not about being able to pay to get out of what you were
| suppsoed to pay for a subscription period.
|
| Keep in mind there is a normal monthly subscription and when
| buying the product the three choices of monthly, annual
| billed monthly, and yearly billed up front are equally
| displayed.
| bomewish wrote:
| Totally agree. I resent the fact that they'd try cash out that
| way. At least ipo or something. More fragmentation is good for
| preventing monopoly.
| peyton wrote:
| If Adobe's a buyer at $20b, they're a buyer at $20b. I don't
| see how selling stock to the public along the way increases
| fragmentation or prevents monopoly.
| cantSpellSober wrote:
| What Adobe product is intended to compete with Figma, Adobe XD?
| madeofpalk wrote:
| Once upon a time, digital product design happened in
| Photoshop and Illustrator. Then competitors like Sketch and
| Figma came out with a better product. This made Adobe create
| XD to compete, but it was unable to make a good product so
| instead they tried to purcahse their competition instead of
| making something better.
|
| 9 months after Adobe announced it was to purchase Figma (and
| 3 months before it hoped the deal would close), Adobe
| discontinued XD.
| cantSpellSober wrote:
| Fireworks tried to fill the gaps between PS and
| Illustrator, but never got traction.
|
| > Adobe discontinued XD
|
| That was my understanding as well, hmm
| cartermatic wrote:
| RIP to Fireworks, it's the first tool I ever used for
| design.
| nolok wrote:
| Fireworks wasn't an original Adobe product but a
| Macromedia one they got during the acquisition. Adobe
| seems to have had some massive lack of effort for those
| (Flash being the prime exemple).
| madeofpalk wrote:
| Yet another example of Adobe purchasing their biggest
| competition and then shutting it down!
| i_am_jl wrote:
| >Fireworks tried to fill the gaps between PS and
| Illustrator, but never got traction.
|
| I couldn't disagree more. Fireworks was a perfect blend
| of raster and vector editing and was _killer_ for early
| 2000s web design work. It was an amazing Macromedia
| product that got neglected by Adobe.
|
| If I'm in a cynical mood I sometimes think it's because
| an up-to-date Fireworks would have cannibalized the sales
| of PS/AI, but I think that gives too much credit to
| Adobe.
| patchorang wrote:
| Yes, XD directly competes with Figma.
| the_mitsuhiko wrote:
| It could. XD is dead but maybe this might inspire Adobe to
| revive it.
| gigglesupstairs wrote:
| They will be forced to now, isn't it? I am sure they
| wouldn't want to start from scratch. But have to admit,
| XD was nothing as compared to Figma right now.
| pier25 wrote:
| XD never took off. If Adobe wants to get into the UI
| market they would need to go back to the drawing board
| and start from scratch. If you're starting with a failed
| product you're most likely going to fail again.
| gigglesupstairs wrote:
| Hmm. May be they see Penpot and learn something from it.
| KaiMagnus wrote:
| They had a really good core in my opinion. The overall
| performance and especially the prototype preview was
| really nice. Every change was instant and not even heavy
| animations were a problem. Much nicer than the Sketch
| slideshow style prototypes and Figma prototypes that load
| very slow, not to mention the bugginess.
|
| Judging by the 20bil price they wanted to pay, I guess
| they know what kind of investment would be needed to
| compete now.
| whywhywhywhy wrote:
| I'd bet they're hoping to just have an AI alternative by 2025
| spaceman_2020 wrote:
| imo, Adobe is falling behind. Photoshop's generative AI is
| substantially worse than what I can get from models on
| Tensorart/CivitAI + an upscaler.
|
| It's way easier to produce something that can go live right now
| without much editing in CivitAI -> Upscale in Magnific -> Add
| to Canva.
| facialwipe wrote:
| I think what you mean to say is Stable Diffusion. CivitAI is
| primarily a host for SD models to download and run locally.
| spaceman_2020 wrote:
| You can run many of the models directly through CivitAI.
| You get lower quality images, but you can upscale them
| through an upscaler.
|
| Just go to any model and click "Create". You can even use
| examples from the model to prefill the prompt.
|
| For example, you can scroll down and click "Start Creating"
| on this page: https://civitai.com/images/3908138
| facialwipe wrote:
| CivitAI's web tools are great for someone getting their
| feet wet but it presents an extremely stripped down
| options UI relative what's available in Draw Things on
| iOS/macOS or SHARK on Windows.
| spaceman_2020 wrote:
| True, but that's precisely my point: even with this
| stripped down version, I was able to hack together
| exactly what I wanted for an upcoming project in far less
| time. I got a model in the exact hairstyle, pose, and
| costume I wanted. The upscaler did a pretty good job of
| making it production ready.
|
| This stuff is wildly productive for noobs who just want
| to get stuff out. Maybe its not something you'd see in an
| Apple ad, but its definitely something you'll see in a
| small business ad.
| costcofries wrote:
| Worse or not, a meaningful majority of users will never even
| understand the alternate workflow you just described.
| spaceman_2020 wrote:
| Then they will be outproduced. I, a graphic design noob,
| managed to create a bunch of social media posts for an
| upcoming project that included a completely custom 3D
| character in precisely the poses I wanted, all within an
| hour. Without gen AI, I would have likely spent hours
| digging through stock photos, modifying lighting and
| colors, and still not achieved what I wanted to.
|
| Not using the latest and greatest tools in your profession
| isn't really a flex.
| Kaijo wrote:
| Maybe they are hampered by "doing the right thing" and only
| training on Adobe Stock content?
|
| Firefly (Adobe's generative AI) works well if you're already
| stuck in a Photoshop-heavy workflow, for quick successive
| generations right in the canvas if you're editing or
| extending an existing image. Better than Stable Diffusion
| Photoshop plugins I've tried.
| SirMaster wrote:
| >Photoshop's generative AI is substantially worse than what I
| can get from models on Tensorart/CivitAI + an upscaler.
|
| But with Photoshops, I can generate things to be seamlessly
| placed into my existing scene, with it understanding things
| like placing the wheels of the car it just inserted on the
| ground, with a shadow underneath and such, again seamlessly
| integrated with my existing image.
|
| It's very much not just about generating an entirely new AI
| image.
|
| Can I do that with Tensorart/CivitAI?
| capybara_2020 wrote:
| Isn't that just inpanting? Stable Diffusion has had it for
| a while.
|
| Eg: https://www.youtube.com/watch?v=No1_sq-i_5U
|
| You can do that with any part of the image, this video
| shows a face sample.
| SirMaster wrote:
| It might be.
|
| https://youtu.be/Sp6K3qpVFO0?t=95
|
| But at the very least, it seems like it's easier to work
| with in Photoshop.
| pier25 wrote:
| I couldn't care less about AI in Photoshop but I'd love AI in
| Illustrator to generate vector stuff.
| jansan wrote:
| AI sucks pretty hard at generating Vectors. The only option
| for now is to generate something in an illustration style
| and have it vectorized.
| pier25 wrote:
| There are a couple of AI vectors services out there but
| the pricing is just silly.
|
| https://vectorart.ai/
|
| https://www.kittl.com/feature/ai-text-to-vector
| facialwipe wrote:
| Text to Vector appears to be a beta feature in Illustrator
| currently: https://helpx.adobe.com/illustrator/using/text-
| to-vector-gra...
| pantulis wrote:
| Adobe's vision is fully supporting the content lifecycle, not
| only the creative aspect. In this sense, Figma made far more
| sense for Experience Cloud rather than what it gives to
| Creative Cloud.
| SnowingXIV wrote:
| Got bit by this. It felt absolutely horrible to not have any
| recourse. We had a yearly adobe sign contract, it was based on
| a particular usage estimate and quite high. Called in weeks
| before the renewal and they said we missed the window to
| cancel. There was no option out of it. No escalation. Had to
| stomach a massive bill for of a product we weren't going to
| use.
| GoRudy wrote:
| Is not paying an option? Ran into this issue with a large
| software provider once but they had some actual account
| management negligence / weren't responsive so we used that to
| hang our hat on not paying and eventually they let it go.
| jdewerd wrote:
| No, because contract law is built for centuries past and
| lets Adobe screw you for trying this. Not sure if they _do_
| , but they definitely _could_.
|
| Back when communication latency was days or weeks, allowing
| sticky auto-renew that ignored payment failure and asked
| for a lot of heads up time on a cancellation made sense. It
| was exploitable, but it was worth it to buffer the latency.
| Now we don't have the latency, so it's just exploitable,
| the law hasn't caught up yet, and Adobe is happy to
| exercise this advantage against you.
| nightski wrote:
| I'm curious, what exactly are the ramifications of this
| "contract law" in the context of Adobe subscriptions?
| Adobe will sue you? Are they suing large amounts of
| customers?
| ceejayoz wrote:
| They'll send you to collections, which'll ruin your
| credit.
| xyzzy4747 wrote:
| How does that work? I don't think Adobe has your social
| security number.
| ceejayoz wrote:
| You don't need someone's social security number to send
| them to collections.
| xyzzy4747 wrote:
| How does it affect your credit score then?
| ceejayoz wrote:
| The information you provide with payment - name and
| address - is sufficient to add a delinquent account to
| your credit report, which will immediately tank it.
| Again, SSN is not necessary for this.
| SnowingXIV wrote:
| The risk-reward here is out of balance for SMB, so while
| we could just not pay it was more headache not to. Here
| is hoping for some class action. Perhaps small claims but
| its pretty frustrating that a company as large as Adobe
| has this in place.
| nightski wrote:
| Does it though? I thought only credit accounts affected
| your credit score. This really isn't that...
| ceejayoz wrote:
| Gym memberships, cell phone plans, utility bills, unpaid
| parking tickets, etc. will all report to your credit
| report if you miss payments. Debt, not just credit cards.
| A delinquent account on your account will drop it by
| 100-150 points immediately.
| jan_Inkepa wrote:
| Also that their cancellation window has limits on both sides
| - I told them more than six months I advance to cancel my
| renewal and the refused and toll me to call up again in a
| particular 30 day period close to the expiry date...
| _fat_santa wrote:
| When your business has to depend on subscription
| engineering like this, it means the underlying product is
| not good enough to stand on it's own feet.
| figassis wrote:
| It probably is, but rent seeking has no limits.
| i_am_jl wrote:
| That's the worst part, the products are great. $20/month
| is reasonable for PS/LR considering that yearly releases
| were retailing for $500+ in the CS6 era. Cloud storage
| and generative AI credits are rolled into those costs.
| New features are showing up again. Regarding Photoshop,
| there are no real alternatives.
|
| It's not that Adobe's depending on subscription
| engineering, it's creative pros 100% dependent on Adobe
| products being willing to put up with this shit because
| they have quality products with no alternatives.
| Spooky23 wrote:
| Exactly. The downside of subscription software is that
| companies like Adobe become life insurance companies that
| produce software. Their enterprise value is defined by
| churn rates and there's a strong incentive to lock
| customers down to reduce that risk.
|
| I work for a huge org, and we tell companies like this to
| go fuck off with terms like this. The real scam of Adobe
| is that there is no way to assess engagement rates with
| their tools. The only way to get this data is by metering
| PCs or datamining your IdP.
| jb1991 wrote:
| > Regarding Photoshop, there are no real alternatives.
|
| Unfortunately, the same is true for Illustrator. There
| are competitors that have 95% of the features, but that
| remaining 5% is critical for serious professionals.
| rchaud wrote:
| > it means the underlying product is not good enough to
| stand on it's own feet.
|
| Adobe CC not strong enough? That's not it.
|
| Subscription retention practices like this are to juice
| quarterly numbers to delight analysts on the earnings
| calls. If Adobe was a private company this level of lock-
| in desperation wouldn't be necessary. We'd still be able
| to buy the software once like we used to.
| toyg wrote:
| That's a hopeful statement. Maybe it wouldn't be
| necessary, but it would be implemented anyway. These
| days, any company not having subscriptions is seen as
| leaving money on the table and they will become targets
| for takeovers.
| rchaud wrote:
| > These days, any company not having subscriptions is
| seen as leaving money on the table
|
| This kind of product economics comes from Wall Street.
| It's led to a world where companies, rather than charging
| at a stable price point that allows them to keep the
| lights on, offer something at an unsustainable $10/mo to
| build marketshare. Then they raise the price every year
| after that, whether or not the additions made have any
| added value.
| sealeck wrote:
| The problem is that Photoshop is actually pretty good
| (although Affinity definitely gives it a run for its
| money and is as good for simple things).
| dylan604 wrote:
| Your comment makes me think you have no experience with
| Adobe's product line if you think it can't stand on it's
| own feet. In fact, after Windows, I'd imagine Adobe
| software being one of the most pirated apps out there.
| Doubtful people would pirate software that's no good.
|
| While your whimsical comment might apply to some rent
| seeking subscription products, as phrased, it does seem
| like you are totally out of line with it application in
| this thread.
| xyzzy4747 wrote:
| Have you tried not paying?
| JCM9 wrote:
| Many states are cracking down on these practices and no
| longer consider "sorry you forgot to cancel" as a legal
| agreement binding you to a renewal. Common sense says you
| should have to consciously renew vs accidentally doing so via
| some bogus contract clause.
|
| Of course if you're relying on such gotchas to keep
| subscription numbers up you've already failed and are just on
| a slow march to irrelevance while leaving pain and
| destruction in your wake.
| foz wrote:
| One of the key functions of procurement: Checking for
| automatic renewal clauses in contracts and removing them when
| found. This is a red flag in many companies.
| plagiarist wrote:
| Glad the FTC is going after them. All predatory subscription
| practices need to be abolished by law.
| coldpie wrote:
| If you like what the FTC has been doing lately, be sure to
| vote in 11 months...
| plagiarist wrote:
| I mean, sure, but what the FTC is doing is not a concern in
| the slightest compared to the issues at stake there. It's
| nice that the agency is doing something I like, though.
| danpalmer wrote:
| > Adobe says the FTC is looking into its subscription
| cancellation practices
|
| Great news, where do I testify? Adobe tried to bribe me
| personally to not fight their subscription cancellation
| policies for the company I was representing. Given how
| obviously unimpressed I was with the whole thing and how I was
| clearly not the target market of a creative cloud subscription,
| I can only assume that this is a policy that the sales rep
| tried to push, rather than a one-off they thought might work.
| ehoh wrote:
| Most effective thing to do relative to your time is probably
| participating in relevant FTC requests for public comments:
| https://www.ftc.gov/policy/public-comments
| dtx1 wrote:
| Looking at your profile, it says you work for Google, so I
| assume this is in the context of google? You guys probably
| have the internal legal resources to advice you. If it was
| not in that context, ChatGPT at least suggest that this is
| first of all a federal fucking crime (Domestic Bribery Act
| seems to apply here) and you can contact the Department of
| Justice, the FBI or report it to the SEC which offers a
| whistleblower program.
|
| Please consider your next steps carefully though and contact
| legal counsel basically immediately since you just publicly
| accused adobe representatives of a federal crime! Frankly, I
| would ask Dan to remove your comment ASAP.
|
| Fun Fact: The SEC offers financial incentives to people who
| report those violations!
| anthuswilliams wrote:
| This sounds it might be like a hallucination. I've never
| heard of any "Domestic Bribery Act" and I'm unable to find
| one in cursory online searching. (In 18 USC there are
| prohibitions on bribing public officials, but that doesn't
| seem relevant here.)
| dtx1 wrote:
| Fascinating, i think you are correct. This website at
| least suggests that there are some other laws regarding
| domestic bribes:
| https://www.globalcompliancenews.com/anti-
| corruption/anti-co...
|
| But "Domestic Bribery Act" seems to be a hallucination. I
| have so far only encountered fake sources or links that
| don't exist, this kind of hallucination is new and
| unexpected.
|
| Thanks for making me aware of this, quite scary how
| utterly convincing chatGPT was in this instance.
| danpalmer wrote:
| Also FWIW, I'm in the UK and was likely dealing with a UK
| subsidiary of Adobe, so the laws would likely be
| different anyway.
| Nemo_bis wrote:
| The SEC effectively has worldwide jurisdiction, for
| something that relates to a USA-listed company. The tip
| submission form seems relatively lightweight.
| https://www.sec.gov/whistleblower/submit-a-tip
| andylynch wrote:
| The UK Bribery Act is, on paper, very strong and broad in
| application. Unfortunately prosecutions under it are
| exceptionally rare.
| cornstalks wrote:
| > _this kind of hallucination is new and unexpected_
|
| I don't think it's new or unexpected at all. Remember the
| lawyers who used ChatGPT and it ended up fabricating case
| law?
|
| ChatGPT is interesting and all but it's seriously
| untrustworthy.
| nicolas_17 wrote:
| ChatGPT is trained to sound convincing, not to be
| correct.
| Spooky23 wrote:
| ChatGPT is not a good place to get legal advice.
| Regardless, there are a variety of ways that you can get
| boned for accepting bribes in your capacity as an
| employee. In the US, the "honest services" laws have been
| weakened by Supreme Court action, but there are other
| paths to criminal prosecution.
|
| The advice of "STFU and get the comment removed" is spot
| on.
| danpalmer wrote:
| This was several years ago in a different role before my
| current employer, and has nothing to do with my current
| employer. I agree that legal advice would have been good
| here, but to be honest I was just glad to cancel the
| subscriptions and move on with more important things. The
| company I worked for is sadly out of business now so
| wouldn't be a target of any action, and I stand by my
| comments in a personal capacity so have no wish to take
| them down currently, but thank you for the advice.
|
| I wouldn't be (and am not) making this sort of accusation
| on behalf of any operating company without prior approval.
| nolok wrote:
| Unless you have clear proof of that (saved emails...) and own
| the company, or you were acting as third party
| (consultant,...) I would advise not making those accusation
| in a public place without consulting with their legal
| representative. It is simply not in your personal interest,
| and if someone starts an inquiry into this and said company
| doesn't want to help much you might find yourself in the
| middle of two legal giants in need of a scapegoat.
| danpalmer wrote:
| Thank you for your advice. The company no longer exists. I
| don't have any records of this because it was over the
| phone and probably 4 years ago.
| ghufran_syed wrote:
| I'm pretty sure adobe is not dumb enough to start a lawsuit
| that would give the defendant the right to go through their
| records ...
| irishcarbomb777 wrote:
| It's great to see the FTC is looking into this. Every time
| I've had to deal with Adobe subscriptions it always feels
| like they put you through some maze which usually ends in
| being forced to pay a cancellation fee or losing in some
| other way. I recently lost 160 asset tokens I had saved up in
| Adobe Stock after canceling my subscription. I'm sure it
| mentions this in the fine print somewhere but the only reason
| I had saved that many tokens up was because I couldn't cancel
| without paying the fee. So they trapped me, took my money and
| then took back the tokens I only paid for because they locked
| me in with a cancellation fee in the first place. At the very
| least I should be able to keep the asset tokens. The whole
| thing seemed absolutely ridiculous to me.
| charcircuit wrote:
| There is only a cancellation fee if you buy an annual
| subscription, paid monthly, and then you don't pay for the
| 12 months you committed to. For people who don't want to
| buy a year at a time there is a monthly plan that is more
| expensive since you are no longer buying in bulk.
| api wrote:
| > Adobe tried to bribe me personally to not fight their
| subscription cancellation policies for the company I was
| representing.
|
| Is that even legal?
| smitty1110 wrote:
| I looked around, and I can't find any names to pin to the
| investigation. There's a very low-tech way to find public
| staff contact information, but you need a name. I don't even
| have a telephone number for what is probably the correct
| group (Division of Financial Practices), just their DC
| mailing address. Regardless, I can tell you that right now
| that Washington offices are empty. Skeleton crews only. Check
| back in after the first of the year.
| dclowd9901 wrote:
| > Adobe just buying up it's competition will only ever directly
| hurt consumers.
|
| I can't tell if this is a general statement about monopolies or
| a statement about Adobe's products.
| hallway_monitor wrote:
| It looks like regulators are actually doing their job. I would
| love to see more of this, along with breaking up companies that
| have gotten too big for their britches.
| scarface_74 wrote:
| The entire purpose of starting a company is to get acquired. Of
| the literally hundreds of companies that YC has invested in,
| only 5 have gone public.
|
| The VC market will dry up even more if they see their chances
| of an exit diminishing because of an overzealous government.
| earthnail wrote:
| Or we'll see more IPOs. It might change valuations as
| expectations might be lower but it won't dry up the VC
| market.
| mushufasa wrote:
| declining frequency of IPOs is mostly driven by regulatory
| requirements that keep getting harder over time; the 90s
| were before sarbanes-oxley. I don't see any reason to
| believe fewer acquisitions will cause more IPOs.
| endisneigh wrote:
| The purpose of a for profit company is to provide a good or
| service and profit from doing so. You don't need to be
| acquired to accomplish that.
| capableweb wrote:
| > provide a good or service
|
| > profit from doing so
|
| Is the first actually a requirement? I can think of plenty
| of companies that do the second part well, but have nothing
| to do with the first one.
| endisneigh wrote:
| Yes? What company makes money without providing goods or
| services to someone?
| ceejayoz wrote:
| Comcast?
| endisneigh wrote:
| Comcast provides plenty of services?
| ceejayoz wrote:
| It would seem my joke about their reliability didn't
| land.
| jen20 wrote:
| Have to admit, my first reading missed the word "or", and
| both AT&T and Comcast came immediately to mind.
| capableweb wrote:
| Patent trolling. Domain flipping. Just two I can think of
| in 30 seconds, I'm sure there are more out there :)
| endisneigh wrote:
| Both provide services.
| capableweb wrote:
| Ok, lets hear you argue for what service a patent troll
| provides.
| endisneigh wrote:
| They provide a license to said patent? Pretty obvious -
| this is not to say that patent trolls are _good_ ,
| though.
| capableweb wrote:
| If you're licensing a patent to others with reasonable
| terms, it's not a patent troll.
|
| I understand you think they provide a service since you
| seem to not understand what a patent troll is.
|
| As a reminder, a patent troll company is a company "that
| attempts to enforce patent rights against accused
| infringers far beyond the patent's actual value or
| contribution to the prior art"
| (https://en.wikipedia.org/wiki/Patent_troll)
|
| They don't sell any services, don't do any (reasonable)
| licensing, nor provide any goods.
| endisneigh wrote:
| Patent trolling is not a company category, rather a
| behavior of a company. Furthermore patents themselves are
| goods that can be licensed, so my point stands.
|
| Not to mention "trolling" is already passing judgement on
| the activity to begin with. The actual service is
| licensing. I'll leave it to the courts to determine
| whether enforcement of patents qualifies as trolling or
| not.
| capableweb wrote:
| > Patent trolling is not a company category
|
| Oh I'm sorry. I meant to say "Patent Trolling Companies",
| is it easier to understand now?
|
| I'm sure you are aware that there actually is a category
| of companies that just participate in "patent trolling",
| and do nothing else. Not sure why you're being so
| pedantic about the grammar instead of trying to reply to
| the actual arguments...
| robertlagrant wrote:
| Seems like if you've only come up with patent trolls,
| then "plenty of companies" doesn't apply. Patent trolls
| weaponise the legal system against other companies. They
| exist because the government can't make a good enough
| patent system.
|
| They don't seem to be significant enough to the overall
| general statement that companies exist to serve their
| customers with goods and/or services.
| capableweb wrote:
| > Seems like if you've only come up with patent trolls
|
| I'm not sure how valuable it is to argue with someone who
| cannot read two messages up in the message hierarchy...
| ianceicys wrote:
| Look at the corporate raiders of the 1980s. Firing
| people, loading up a company with debt. And taking them
| bankrupt makes a ton of money for private equity. No
| product required, immensely profitable!
| robertlagrant wrote:
| > I'm not sure how valuable it is to argue with someone
| who cannot read two messages up in the message
| hierarchy...
|
| Do you mean the one you mentioned 4 messages up? And
| dropped with this?
|
| > Ok, lets hear you argue for what service a patent troll
| provides.
|
| Sure - the one you dropped was domain flipping. Clearly
| buying something at a certain price and then selling it
| again is not nothing - that's why people pay for it. Just
| like house flipping. Or just buying anything
| speculatively. I assume you realised that, and dropped it
| for that reason.
| andsoitis wrote:
| > Patent trolling. Domain flipping. Just two I can think
| of in 30 seconds, I'm sure there are more out there :)
|
| In the vast sea of companies, those are a super teeny
| tiny share of companies.
| oblio wrote:
| You're misreading the text. They said "provide A good OR
| service", they're not saying "provide good service".
| capableweb wrote:
| I don't think so, I read and understand the "OR" in
| there.
| ianceicys wrote:
| Look at the corporate raiders of the 1980s. Firing
| people, loading up a company with debt. And taking them
| bankrupt makes a ton of money for private equity. No
| product required, immensely profitable!
| ianceicys wrote:
| You are mistaken.
|
| The purpose of a company is to make a profit and provide a
| good or service. In that order. Everything else is a hobby.
| endisneigh wrote:
| Nope. Profit follows the goods and services, not the
| other way around.
| ianceicys wrote:
| Tell that to Too BIG to FAIL banks...look at the Billions
| given from the government to lobbying companies.
| dahart wrote:
| Why do you say that, and how does it work? Are you making
| a completely different statement than the point the
| parent was making? Sure you usually need to sell
| something in order to get the profit, but that doesn't
| mean that the good or service or it's quality was
| prioritized above getting any profit, which is what I
| think parent was talking about.
|
| Generally speaking, private non-subsidized companies that
| offer goods and services for sale cannot actually survive
| without any profit, right? They can bootstrap for a while
| with investment, but they tend to die, statistically
| speaking, if they prioritize goods and services over
| profit. The way companies tend to survive death is by
| doing everything they can to ensure that the sale of
| their goods or services generates a profit. You might
| also be temporarily forgetting that it's also incredibly
| common for companies to pivot on what products they make
| and sell whenever they're not making enough profit.
|
| TBH it actually seems really funny to me argue about
| which comes first, because the kind of company we're
| talking about needs both, it doesn't otherwise exist. But
| the idea parent shared, that profit takes the highest
| priority, is often absolutely true in practice, many
| companies will do everything they can to avoid not making
| a profit, from lowering the quality of their goods and
| services, to coming up with other more profitable
| products, to merging with another company that has more
| customers for your product and/or a longer runway.
| earthnail wrote:
| Depends on your worldview. Historically, companies had a
| purpose first and profit second. You needed approval by
| the crown before you were allowed to start a company.
| Then, once your company fit the purpose as seen by the
| crown, you were allowed to make profit with it.
|
| That has changed, especially since the 80s, where the
| prevalent world view turned to "let's have the market
| figure out purpose", which equates to anything that is
| profitable is good.
|
| We've since learned that this isn't automatically true
| (as exemplified in this abandoned merger, for example),
| and my understanding is that right now there's no clear
| opinion in society whether profit or purpose comes first
| in companies.
| macintux wrote:
| When there are elected officials who say that maybe
| capitalism is more important than democracy, it becomes
| clear that consensus is going to be difficult to achieve.
| chiefalchemist wrote:
| Yes. But when you're driven by the idea of exit striving
| towards such things becomes ultra focused. Put another way,
| exit is the ultimate recognition that these purpose(s) have
| been acheived.
| endisneigh wrote:
| There are ways to exit other than being acquired, still.
| chiefalchemist wrote:
| Those are still exits.
| ethanbond wrote:
| The entire purpose of antitrust regulation is to prevent
| monopolization.
|
| Both those things can be true and both can be legitimate
| interests.
| ceejayoz wrote:
| > The entire purpose of starting a company is to get
| acquired.
|
| The vast majority of companies are little "lifestyle"
| businesses without any intention of ever getting acquired by
| anyone. Your local pizza shop doesn't expect to be a unicorn.
| chiefalchemist wrote:
| And *this* is The Key difference between an entrepreneur
| and a mom & pop.
|
| That said, even a mom & pop should be mindful of exit. What
| happens when the owner(s) wants to retire? Or has a serious
| health issue? Or has a family member with a health issue?
| Etc.?
|
| You don't have to be a unicorn to build something that
| someone else wants to acquire.
|
| Editorial: And this is why I dislike words like
| solopreneur, mompreneur, and so on. Sure you can have a one
| person business with a steady revenue stream. But that's
| not a 'preneur. If you are the business and the business is
| you, you're ability to exit is highly limited. That's not a
| 'preneur. If you get hit by a bus and your customers are
| screwed and the business tanks. That's not a 'preneur.
| You're much closer to a m&p TBH.
|
| I realize that's counter to conventional wisdom on social
| media, but such snake oil ideas deserve to be called out
| already.
| ceejayoz wrote:
| Mom-and-pop businesses fit the definition of entrepreneur
| just fine. I'm not willing to let Silicon Valley VCs
| redefine the term.
|
| > What happens when the owner(s) wants to retire?
|
| Maybe they just close down the shop.
|
| > Or has a serious health issue?
|
| And purchase disability insurance.
| chiefalchemist wrote:
| The point is, regardless of circumstances, if no one
| wants to acquire the business then the business by
| definition has not created value (in the eyes of the
| market).
|
| Being a mom & pop is not the same as being an
| entrepreneur. They are two separate mindsets. One use
| exit as a North Star the other just retires and closes up
| shop.
| rcxdude wrote:
| someone starting a mom & pop business _is_ an
| entrepreneur. There 's nothing about scale in the
| definition of the word.
| chiefalchemist wrote:
| I didn't say there was. I said it was about value, as in
| creating something someone else wishes to acquire.
|
| There's nothing wrong with the mom & pop mindset. But
| it's not the same mindset as being an entrepreneur and
| focusing on value; with exit being a clear and ideal way
| to see the value.
| ethanbond wrote:
| _Your definition_ is the social media-fueled snake oil
| meme.
| chiefalchemist wrote:
| One very simply question: What defines value better than
| an exit? Or the offer to exit? (Hint: Nothing.)
|
| You might not like the definition, but that doesn't mean
| it's wrong.
| ceejayoz wrote:
| Exit valuation doesn't come from God. It comes from
| metrics like growth, profit, etc., all of which are
| readily available without _actually exiting_.
|
| Even if we accept your assertion that it's the _best_ way
| to value something, that doesn 't mean it's the _only_
| way to value something.
| chiefalchemist wrote:
| Nah. Not at all. Those are all proxies.
|
| It comes from The Market. It comes from some other entity
| saying, "This is worth X to us, and we're willing to pay
| that. Here's an offer."
|
| THAT is value. I've already said this, but I'll say it
| again:
|
| Revenue !== value.
| ethanbond wrote:
| Revenue actually _is_ value (a subset of it) delivered to
| the business 's customers. Enterprise value is a
| different thing. It's an important thing, but it's
| totally possible to have a business that delivers immense
| value to its customers and has very low enterprise value.
| We generally call these "not great businesses," but that
| doesn't make them _not businesses._
| chiefalchemist wrote:
| Not really. You can for example generate $1,000,000 in
| revenue and not generate value. Perhaps you're not
| profitable, and therefore perhaps not attractive to being
| bought. That is, no value.
|
| Value is what someone is willing to pay (for the
| company). It is set by the market. Revenue may or may not
| be used by the suitor to determine value, that is, how
| much they're willing to pay to acquire the generated
| value.
|
| Revenue !== Value
|
| To clarify, they are all business in the legal sense. But
| a "solopreneur" who gets hits by a bus, leaves customers
| high and dry, and can't exit (i.e., have someone else
| carry on) is not to compared to an entrepreneur who
| generates value such that an exit is possible, and
| customers are less likely to get screwed.
| ethanbond wrote:
| You are specifically referring to a concept called
| "enterprise value."
|
| Notice the modifier. That indicates it is not the only
| (and to many people, not even the most important) type of
| value.
| ethanbond wrote:
| So that value just magically appears at the moment of
| offer to exit?
| chiefalchemist wrote:
| Yup. Something is only worth what someone else (i.e., The
| Market) is willing to pay for it. You can stack up a ton
| of customers and revenue but if no one else wants
| it...sorry...no value.
|
| At the extreme, imagine all these social media
| "creators". In some cases, tons of revenue. But their
| revenue-producing-hobby is such that no one could take
| the torch and carry on. If that person is abducted by
| aliens, the company also disappears. No one else can buy
| it and carry on. That is, no value created.
|
| I'll keep repeating this:
|
| Revenue !== value
|
| Entrepreneurs create value. Not revenue. Value.
|
| The problem with this thread seems to be that people are
| confusing revenue with value. If it was about revenue,
| then the definition would say that. It specifically says
| value.
| ethanbond wrote:
| > Revenue actually is value (a subset of it) delivered to
| the business's customers. Enterprise value is a different
| thing. It's an important thing, but it's totally possible
| to have a business that delivers immense value to its
| customers and has very low enterprise value. We generally
| call these "not great businesses," but that doesn't make
| them not businesses.
| chiefalchemist wrote:
| Not really, revenue is not value. It's used as a proxy
| but it's not a true indicator of value. An extreme
| example, LOADS of revenue but also loads of expenses
| (i.e., not profitable). Is that "creating value"? I think
| not.
|
| Or again, the "influencer" model. TONS of revenue but
| when was the last time you heard of such a person
| selling? They're not because there's no value. The
| influences walks away, the house of cards collapses. No
| one is going to pay for that. So, sorry, no value -
| regardless of revenue.
|
| Therefore, if you ever want to know the value of your
| business as a reflection of the alleged value it creates,
| put it up for sale (or sell shares). You will quickly
| find out if you're actually creating value or not, or at
| least someone thinks you have the potential to create
| value. But that isn't revenue.
|
| That's it. You want to measure value? Then be prepared to
| ask the market (i.e., exit) Anything else is a proxy, a
| deception, or something you tell yourself to make
| yourself feel good.
| IKantRead wrote:
| I'm pretty sure Sam Walton didn't establish Walmart with
| the hope of being acquired.
|
| It's bizarre that we live in a time where we can't even
| fathom a business that is fundamentally very profitable,
| we just envision growing the company until it's
| attractive enough for someone else to take on the
| unsustainable cost of running the business: either get
| acquired by a large company or hoist your debt onto the
| public market.
|
| Investment really did used to be about more than a
| complex "greater fool" game.
| Hasu wrote:
| > But that's not a 'preneur. If you are the business and
| the business is you, you're ability to exit is highly
| limited. That's not a 'preneur. If you get hit by a bus
| and your customers are screwed and the business tanks.
| That's not a 'preneur.
|
| Sorry, but it absolutely is. Entrepreneurship is just
| starting a business and taking on the majority of the
| risks and rewards. There is nothing in the definition
| that says you have to sell the business or exit in any
| way.
|
| I'd argue that taking on VC money is actually less
| entrepreneurial than going it alone - you're offloading a
| big chunk of the risk to your investors.
| chii wrote:
| > The entire purpose of starting a company is to get
| acquired.
|
| or to make profit. Being acquired used to mean you failed,
| and had to suck your pride in and let someone else buy you
| out to pay off your debts.
| tebbers wrote:
| No it isn't just about selling out. It's to unseat
| incumbents, deliver better products, make a difference. What
| do you think Google would have turned out like if Yahoo had
| bought them for $1m in 1996?
| gumby wrote:
| An underzealous government (in regards to antitrust) is as
| bad as the number of potential acquirers is smaller; in such
| a monopsony environment purchase prices will be smaller too.
| kozikow wrote:
| There's also always a private equity market that is often a
| middle ground between IPO and acquisition.
|
| And in my feeling, I've seen PE getting more active in tech
| last year (maybe just because valuations went down).
| jen20 wrote:
| PE universally has the worst possible outcomes for all
| sides of a deal besides the PE firm themselves.
| kozikow wrote:
| Just because the acquired company falls into the "can't
| justify higher rev multiple thanks to synergies with the
| acquiring company" and "not successful enough for the
| IPO".
|
| If there was no options in that niche, the market
| objectively would be a lot tougher.
| piva00 wrote:
| Corporate consolidation is not a good end for capitalism. If
| you believe in the capitalist system you'd prefer that less
| acquisitions happen given that we've empirical data where a
| lot of these acquisitions are made to stamp out competition.
|
| If the business model is to be acquired that will require the
| business model to change, I'd prefer that than a bunch of
| companies only working to be acquired, fucking customers in
| the process (and all of the externalities deriving from that,
| like wasted man-hours to move away from products that will be
| killed).
| joshstrange wrote:
| I think the state of "build to be acquired" is actually
| pretty gross and I wouldn't mind it being pruned back a bit.
| To call this "overzealous government" is a bit ridiculous.
| Figma being acquired by Adobe was not good for customers, in
| most cases the government just allows shit like this to
| happen, this is the exception, not the rule.
| treprinum wrote:
| Statistically, 90% of startups go belly up, 6% end up as
| zombies barely scraping by, 3% are acquired and 1% go
| public.
| andruby wrote:
| I agree with your statistics and want to add extra
| context that these statistics are about (US?) _startups_.
| There are a lot of companies being started that don't
| pursue huge growth. I believe they are sometimes referred
| to as "mom and pop" shops in the US. In europe they're
| just called businesses or SME's.
|
| I don't have any numbers and probably more than 50% do
| fail, but not 90%. Plenty of bakers, restaurants,
| accountants and small shops succeed in making money for
| the owners, employment for the staff and value for the
| customers.
| robertlagrant wrote:
| > in most cases the government just allows shit like this
| to happen
|
| Good. Agreements should as much as possible be free between
| consenting parties. It shouldn't be normal to expect the
| government to be involved in approving things except where
| there's a great reason to need it.
| Drakim wrote:
| Especially things like when a company owns the entire
| town and pays their workers in scrip. Both the company
| and worker is a consenting party, so the government
| should stay out of it.
|
| The problem with this ideology is that will destroy
| society and reduce it to ashes.
| robertlagrant wrote:
| You think this is "ideology" that will cause that?
|
| > It shouldn't be normal to expect the government to be
| involved in approving things except where there's a great
| reason to need it.
| itishappy wrote:
| Yes. Your quote is an example of the exact ideology that
| leads to Standard Oil and company towns.
| robertlagrant wrote:
| What is that ideology? "Government shouldn't be involved
| unless there's a great reason to do so"?
|
| If you think preventing company towns isn't a great
| reason to need approval, fair enough, but then why are
| you saying company towns are bad?
| scarface_74 wrote:
| So exactly how was the government preventing a company
| town here?
|
| And if a town is dependent on one major employee should
| we do what exactly?
| robertlagrant wrote:
| > So exactly how was the government preventing a company
| town here?
|
| Where is here?
| scarface_74 wrote:
| By stopping Adobe from buying Figma. How exactly has the
| government stopped Adobe from starting a company town?
| robertlagrant wrote:
| Sorry, I don't see why you're replying to my comment on
| this - I wasn't saying Adobe is about to start a company
| town.
| scarface_74 wrote:
| Then what exactly is the purpose of bringing up "company
| towns" in a post about Adobe not being able to buy Figma?
| itishappy wrote:
| No. I think anti-trust regulations are really important.
| Don't you?
| robertlagrant wrote:
| "unless there's a great reason to do so"
|
| I'm really struggling to understand why you're asking
| questions tartly instead of just reading what I said,
| which I tried to make very simple to understand, and
| replying just as simply.
| itishappy wrote:
| I've read it. I'm asking questions because I'm struggling
| to understand the point you're trying to make. I thought
| I understood, but your response was so far off of my
| intent that I'm no longer certain.
|
| You said the government shouldn't involve itself "unless
| there's a great reason to do so," which I interpret as
| implying you disagree with the reasons. Do you think
| anti-trust measures are a great reason?
| cjaybo wrote:
| We could guess or we could refer to history to here.
| Maybe you would rather be doomed to repeat it?
| scarface_74 wrote:
| Yes because
|
| Step 1: Adobe buys Figma
|
| .
|
| .
|
| .
|
| Step n: Adobe takes over a small town and forces people
| to make websites?
|
| Please tell me how the government's actions has stopped
| that conclusion.
| scarface_74 wrote:
| Well seeing that we are talking about software company ,
| I fail to see where this analogy is at all relevant
| scarface_74 wrote:
| Would you want the government to step in and tell you that
| you couldn't sell what you own?
| layer8 wrote:
| Luckily, successful companies can also be started without VC
| money.
| jen20 wrote:
| Realistically, only by the already-wealthy - i.e. those for
| whom the cost of failure is less than complete personal
| ruin.
|
| Admittedly these are the people getting the lions share of
| VC money in the first place though.
| epolanski wrote:
| You should send this memo to Musk, Zuck and many other
| entrepeneurs telling them they doing everything wrong.
| hliyan wrote:
| > The entire purpose of starting a company is to get acquired
|
| The entire purpose of starting a company is to make a profit
| by delivering a product or service that the market will
| willingly buy. The operative word there is "profit" --
| something that seems to have going conspicuously missing from
| companies that are being built for the purpose of being
| "exited".
| qwebfdzsh wrote:
| > The entire purpose of starting a company is to make a
| profit by delivering a product or service that the market
| will willingly buy
|
| Why? People can start companies for whatever reason, also
| your company itself can be the product and big tech
| companies might be the market you're targeting. Users might
| just be along for the ride (and they get cheaper and/or
| better products because VCs are willing to subsidize their
| development).
| edouard-harris wrote:
| > The entire purpose of starting a company is to get
| acquired.
|
| Certainly not in terms of expectation value. Most of the
| value of a startup at any given funding round is driven by
| the possibility of a public listing. This is true _even
| though_ most successful startup _outcomes_ are acquisitions.
|
| > Of the literally hundreds of companies that YC has invested
| in, only 5 have gone public.
|
| The correct number is 18, not 5. [1]
|
| [1] https://www.ycombinator.com/topcompanies/valuation
| (select the "Public" tab.)
| scarface_74 wrote:
| So instead of .125% of companies. It's .45%.
|
| The best I could find is that YC has invested in 4000
| companies..
| spencerchubb wrote:
| This page indicates that YC invested in 18 companies that
| went public.
|
| https://www.ycombinator.com/topcompanies/valuation
| uxp8u61q wrote:
| > The entire purpose of starting a company is to get
| acquired.
|
| I imagine this claim is satire, given how outlandish it is.
| But if I were to take it at face value for a second...
| Acquired by whom? Other companies... Who were started to...
| Get acquired themselves? Where did these other companies get
| the money to begin with? Etc. This is just a stupendously
| ridiculous take, I just cannot consider it was made in good
| faith.
|
| > Of the literally hundreds of companies that YC has invested
| in, only 5 have gone public.
|
| YC is a droplet in the ocean of the economy. Even if we just
| look at the US, about _five million_ businesses were started
| in 2022 alone. https://www.census.gov/econ/bfs/index.html
| scarface_74 wrote:
| So how many VC funded companies do you think get acquired
| instead of IPOing?
| urbandw311er wrote:
| With all respect I think you're completely wrong - this is
| not supposed to be the "entire purpose" of starting a
| company.
| hliyan wrote:
| Public approval like this is a good signal to send to the
| regulators (and disapproval when they fail to do their job) --
| it helps counterbalance the pressure from lobbyists and
| politicians aligned with industries.
| schneems wrote:
| What's the best way to send signals to regulators?
| hliyan wrote:
| I think more people talking about it publicly on social
| media will do. Today, social media seems to drive at least
| some part of traditional media coverage, and traditional
| media coverage at least in part drives political debate and
| at least a part of that drives actual policy.
| thejackgoode wrote:
| I think public discourse on social media is close to
| being ruined by bots. Petitions which require id to
| authenticate might be a better measure, although has it's
| flaws for sure.
| wmeredith wrote:
| > talking about it publicly on social media will do
|
| No way. Slacktivism is a pejorative for a reason.
| Compared to an upvote or a comment on [social media
| platform], a call or physical letter will have between 10
| and 10,000 times the impact on your targeted public
| servant.
| schneems wrote:
| Possibly if you mention them, likely not even then. Most
| accounts are run by staffers.
|
| Getting media attention is a long shot.
|
| I asked the original question. I was hoping for a "here's
| a list of people you can email or call or write to"
| resource.
|
| Social media is better than nothing, but it would be a
| lot more impactful to go the extra distance to make sure
| it lands somewhere people are already looking.
|
| I just wish I knew where that somewhere was.
| dfxm12 wrote:
| Vote for politicians who _don 't_ run on a platform of
| deregulation for deregulation's sake.
| coldpie wrote:
| Talk positively about the current FTC and make sure they
| don't get booted out next year.
| rchaud wrote:
| Inform your local elected official and ask them to contact
| the FTC.
| londons_explore wrote:
| The problem is nearly all company mergers, both big and small,
| are detrimental to competition...
|
| Even my local corner store merging with a corner store in the
| next town over is bad for suppliers (combined negotiations when
| buying stock), and bad for consumers (prices set the same
| between the two towns).
|
| I wonder what a world where company mergers were banned would
| look like?
| jenscow wrote:
| Not disagreeing with you, however some mergers can be good
| for the consumer.
|
| With your example, the local stores could have joined forces
| to compete against their bigger competitor: the supermarket.
| macintux wrote:
| I imagine you could look at U.S. banking before and after
| 1980 to get some sense of what an industry looks like before
| and after mergers became legal.
|
| https://en.wikipedia.org/wiki/Depository_Institutions_Deregu.
| ..
| andruby wrote:
| coops usually seem like a net-win for everyone. If you ban
| mergers, that probably also impacts co-operations.
|
| Joint-ventures might also be a postive. I can think of ARM,
| and the alignment in the automotive industry to standardise
| parts and platforms to lower total costs.
| BurningFrog wrote:
| If companies can't be sold, there is less reason to start
| them.
|
| In the mainstream economist view, mergers are generally good,
| both for the companies and society. If they don't produce
| some efficiency surplus, there is no reason for the companies
| to do them.
| TheCoelacanth wrote:
| I wouldn't go that far.
|
| If instead of Adobe buying Figma, it was Adobe's biggest
| competitor, that would probably increase competition by
| making that company a more viable competitor to Adobe.
| londons_explore wrote:
| How about a merger tax?
|
| Every time a company merges, say 10% of the combined value of
| the new company is given to the government (perhaps with a
| discount if one or other of the merging companies has
| recently paid the merger tax).
|
| The lack of the 10% fee for a company who didn't merge is
| effectively compensation for the fact it has less market
| control than peers in the same market who did merge.
| fauigerzigerk wrote:
| _> The problem is nearly all company mergers, both big and
| small, are detrimental to competition..._
|
| Mergers are not the only way in which market concentration
| happens though. You can't ban asset sales and you can't ban
| companies from hiring employees of weaker or defunct
| competitors.
|
| If the owners of Figma decided that Figma wasn't viable as a
| standalone company, they could sell the software and fire all
| employees so they could be re-hired by whoever bought the
| software. No regulator in the world would mandate the
| software to be destroyed and the employees exiled.
|
| Also, I don't think a market without mergers and acquisitions
| would necessarily be very competitive. It could well trend
| towards an equilibrium where a few big incumbants would rule
| their respective turfs unchallenged and a large number of
| tiny companies without the capital to do anything big.
|
| I think merging legal entities is just a more efficient, less
| messy way of handling asset sales.
| paulpan wrote:
| At least the European regulators are. Still waiting for US
| agencies to do their job...case in point: Intuit.
| hotpotamus wrote:
| It seems like the common refrain is to blame Lina Kahn for
| conservatives stacking the courts against her since before
| she was born.
| LewisVerstappen wrote:
| Um, no. You've somehow confused the supreme court with the
| US court system as a whole.
|
| If you look at stats, it's about a 50-50 split in
| appointments between right vs. left.
| anon291 wrote:
| I really think we should distinguish between people providing
| goods to the public, for which there is an immediate need for
| competition, and B2B services like Figma. Monopolization of the
| former can cause active harm to individuals right now.
| Monopolization of the latter leads to... businesses having to
| spend more and provides incentives for other competitors. In
| particular, what I think a lot of people are missing is that
| this could be the end for Figma too. I'm going to guess the
| workers there were really hoping for a payout. If they don't
| get that, there's going to be de-motivation. Especially having
| basically been told they're too big to acquire. An IPO is
| possible, but the opportunity costs given the current markets
| are almost too much to bear. I feel sorry for them.
| notnullorvoid wrote:
| Any policy that disincetivizes growth by unsustainable
| practices is good policy IMO. We need less companies who's
| end goal is getting acquired, and more that are in it to
| build a self sustainable business. Having employee motivation
| hinge on a acquisition is one of the most toxic business
| practices.
|
| My general rule of thumb is that unless the company is
| putting you in a position where you actually get to drive,
| stock should be treated only as icing on the cake of an
| already worth while salary. (Unless it's a publicly traded
| company where you can reasonably assert that stock price will
| most likely go up or stay around the same)
| zlwaterfield wrote:
| This is sad for the overall M&A market. Companies are going to be
| scared to enter into these agreements because it's just a waste
| of time and money when it inevitably ends up like this.
| nolongerthere wrote:
| Which I think is overall good for the consumer, many of the
| companies are only merging to lessen competition, not provide
| any extra value to us.
| ssgodderidge wrote:
| While I agree that this deal was ultimately bad for
| consumers, weaker M&A markets, in the long run, may hurt
| consumers equally as bad. A lot of "copycat" companies get
| created when they see a particular company doing well. While
| sheer profitability is the major factor in this, M&A, and the
| likelihood of a liquidity event play a large role here too.
|
| Hopefully future us won't look back at this deal as the
| beginning of a weak M&A market
| graphe wrote:
| "May". Less small business and more corporate control isn't
| making the world good enough to say we need more M&A.
| ddkper wrote:
| The value accrues in the form of incentivizing new products
| and companies to enter the market. The two options these
| founders (and their investors) have to capitalize on building
| a good company is to either go public or get acquired.
|
| Severely limiting the ability to be acquired reduces the
| incentives for new founders as well as investors in new
| companies if the only realistic path is waiting for them to
| go public. Especially since being acquired doesn't require
| you to be in nearly as good a financial position in terms of
| profit as going public does.
| graphe wrote:
| I can't think of a single time that was overall beneficial
| for the US in the last decade. A bunch of time sucking
| sites I don't consider life improving. It won't stop small
| business and it'll stop big companies from their shitty VC
| style squeeze everyone out of the market tactic? I don't
| mind losing that 'value'.
| tikkabhuna wrote:
| However, product innovation doesn't happen without
| competition. Acquisitions aren't necessarily bad, but a
| company being bought by a competitor with a similar product
| lessens competition and can lead to less innovation.
| zlwaterfield wrote:
| There's a bigger picture than just the consumer. If there is
| not a chance to exit then founders won't be incentivized to
| create these companies and employees won't be incentivized to
| join or stay at these companies. If M&A markets are limited
| then the only option is IPO which goes through major cycles
| and probably can't support the number of companies needed.
| Plus many companies can't get big enough to IPO.
| mrkurt wrote:
| Is this true? I assume there _must_ be founders who won 't
| start companies if they can't get acquired, but I'm not one
| of them. And I think my closest friends aren't either.
| madeofpalk wrote:
| In the same way that animal cruelty laws is bad for the cock-
| fighting market. Is the "M&A market" a valuable market worth
| having?
| sokoloff wrote:
| Do companies like YouTube and Instagram get started and
| funded less frequently if the climate evolves to "it's
| impossible to have large mergers approved"?
|
| It's a bit like asking in 2009 if the secondary mortgage
| market is a valuable market worth having. It provides
| significant good (IMO) to support real estate transactions.
| madeofpalk wrote:
| I'm not sure.
|
| But, I don't think that YouTube or Instagram are an
| inherent moral requirement for society, so I don't think
| it's the end of the world if they never existed.
| sokoloff wrote:
| Extremely few companies meet an "inherently moral
| requirement for society" standard.
| madeofpalk wrote:
| Right :)
| thrillgore wrote:
| And good for users because it means Adobe can't nickel and dime
| creatives by buying out competitors. Tell me you're an MBA
| without saying it.
| airstrike wrote:
| It's sad for the bad part of the M&A market that is against
| competition. there's tons of good M&A that will still get
| approved. it's not bad that companies need to think twice and
| consider anti-trust before getting deals done
| xd1936 wrote:
| Great news for Figma lovers.
| nolongerthere wrote:
| I'm just shocked that it's been over a year since this merger was
| announced, I feel like it was sometime this summer, turns out it
| was last summer!
| saos wrote:
| Amazing news!!!!!!!
| thrillgore wrote:
| Thank fucking god. I am worried though that Figma will take the
| cancellation fee and start the layoffs to maximize it for an
| eventual IPO, and then blame the merger.
| sokoloff wrote:
| That's a reasonable worry because that's a reasonable path for
| the company to take, isn't it?
|
| Try to sell to the buyer who would maximize the return to
| company [shareholders]; when that falls through, take whatever
| the next best path for them is.
| pavlov wrote:
| Figma is VC-funded. Now that they're not going to be part of
| Adobe, they'll just more slowly turn into another Adobe because
| the investors want the exit.
|
| Prices will creep up, product segmentation will be introduced,
| pop-ups pushing expensive service add-ons will eventually appear.
| And when the revenue number is pumped enough, it goes public or
| is sold to private equity which has no trouble with antitrust
| regulators.
| capableweb wrote:
| > Prices will creep up, product segmentation will be
| introduced, pop-ups pushing expensive service add-ons will
| eventually appear
|
| Have you used Figma lately? All of those things have been
| happening for years with Figma, even before rumors about the
| Adobe purchase appeared.
| wolfpack_mick wrote:
| In terms of pricing model Adobe is generous compared to
| Figma. Someone with their own creative cloud subscription can
| open my .psd's. But if I want to collaborate with someone in
| Figma, I need to pay for their access even if they have their
| own paid Figma account.
| capableweb wrote:
| Absolutely, that I agree with.
|
| But even so, Figma's prices have been increasing, the
| product is being segmented, they're increasingly pushing
| for various addons, even if Figma still is cheaper than
| Adobe.
| pavlov wrote:
| Yes. Which is why I'm surprised that people seem to think
| this break-up will prevent Figma from turning into yet
| another Adobe-like SaaS with heavy upsell.
| WillAdams wrote:
| Given how Adobe's last purchase of a drawing program (buying
| Macromedia ten years after being told to wait a decade after
| buying Aldus and it being split off to be acquired by Macromedia
| and then off-shoring Freehand/MX to India and then burying it),
| good.
| zukzuk wrote:
| I still mourn the end of Freehand. Illustrator's UI never
| matched Freehand.
| pier25 wrote:
| And Fireworks
| kubrickslair wrote:
| Fireworks so elegantly captured the vector level control
| along with bitmap effects like Photoshop!
| seanalltogether wrote:
| I still keep a copy of CS6 on my windows machine just for
| access to fireworks. I should probably learn something new
| at this point but there is just something about the
| presentation of the canvas, pixel snapping, and palettes
| that I can't give up.
| pier25 wrote:
| They really hit the sweet spot with Fireworks.
|
| I wouldn't be surprised if Adobe's decision to phase it
| out resulted in all these new UI design apps to appear in
| the market (Sketch, InVision, Figma, etc).
| unsupp0rted wrote:
| And Dreamweaver
| josefresco wrote:
| Fireworks crew in the house! Still use it, although I've
| tried and tried, and am still trying to transition to
| Affinity.
| duringmath wrote:
| The US should start doing something about these foreign
| governments meddling in US business before it's too late.
|
| EU and UK and seemingly everyone else is passing laws and setting
| up bureaucracies specifically to implement unfair trade
| restrictions and barriers against US companies and they're
| basically doing it unopposed, you'd think these actions would at
| least trigger some tariff threats and WTO complains sadly the
| government is in a self destruct spiral at the moment.
| xuki wrote:
| It's very easy, just don't operate in said jurisdictions.
| duringmath wrote:
| That's not how free trade works or not how it's supposed to
| anyway.
|
| You can't just go after a sector of your trade partner's
| economy just to compensate for your home sector's
| deficiencies.
| manuelabeledo wrote:
| So governments are supposed to let corporations run
| unabashed in their jurisdictions?
|
| > You can't just go after a sector of your trade partner's
| economy just to compensate for your home sector's
| deficiencies.
|
| Is that what the EU is doing, or is it what you yourself
| think they are doing?
| tonyedgecombe wrote:
| Only if the US wants to lose those pesky UK and EU markets.
| dboreham wrote:
| EU and UK authorities are not quite as corrupt as the US.
| wg0 wrote:
| Let's forget Europe and let's focus on the US market alone.
|
| If we do the math, we have to ask - where would those 20
| billion dollars come from that were to be paid by Adobe to
| Figma investors? I'm sure not from Adobe's coffers, their bean
| counters would place them onto subscription pricing with a time
| cap to recoup all that cost. For sure.
|
| I would assume that regulators aren't unaware of that in the
| said markets (UK/Europe) and are not pro investor (few
| hundreds) rather pro consumers (millions)
| duringmath wrote:
| And? Companies aren't allowed to make money anymore?
| wg0 wrote:
| Total investment is around 350 million dollars. Adobe is
| paying 20 billion dollars.
|
| What company is making money in this?
|
| It is the investors that poured in 300+ million were going
| to have a massively inflated payback day, later compensated
| and loaded on to the backs of unsuspecting end users.
| duringmath wrote:
| Investors get rewarded for their early bets, and Adobe
| gets to bet on future profits and growth by acquiring
| some valuable assets and hiring some talented people this
| is exactly how it should work.
| kossTKR wrote:
| Great news. Adobe is already the kind of company that should be
| forcefully closed down for scamming people with their
| subscription practices.
|
| The sign up, and cancelling process of their various services are
| so "dark design" it's criminal. I've had to wait in a chat window
| for days to have a service cancelled after signing up for
| something i clearly didn't sign up for, a yearly payment instead
| of a monthly with no warning for a very expensive suit, and many
| are in the same boat almost bankrupting entire small companies.
|
| More and more places does this and they should all banned and
| their CEO's put in jail because they prey on vulnerable people,
| steal millions and waste everyone else's time.
|
| I'm not kidding one bit with the jail thing, lines have been
| crossed so much it's getting ridiculous now, i don't care how
| rich or powerful you are. This is why we need strict regulation
| and serious consequences for CEO's and shareholders of straight
| up criminal companies.
| wolfpack_mick wrote:
| I have the feeling this is only getting worse now that
| borrowing money is suddenly more expensive..
| lvl102 wrote:
| As someone who enjoyed using Figma, this is an excellent news.
|
| However, I am afraid they will sell to someone else. Namely,
| Microsoft.
| airstrike wrote:
| That's still a better long term outcome than selling to Adobe
| lvl102 wrote:
| Agree 100%. Microsoft would actually make the product a lot
| better and add useful AI elements to it. I just don't trust
| Adobe.
| sensanaty wrote:
| Depressing to see people trusting _M$_ over literally
| anything else...
| Solvency wrote:
| What other beloved product has MS acquired and made a lot
| better?
| airstrike wrote:
| GitHub? But that's not the point. The point is the value
| of not having Figma sell to its largest competitor.
| macspoofing wrote:
| >The point is the value of not having Figma sell to its
| largest competitor.
|
| Adobe does not compete with Microsoft in any meaningful
| way. There is some overlap in some products here or
| there, but it's not meaningful competition.
| airstrike wrote:
| I'm not saying Adobe competes with Microsoft.
|
| Adobe competes with Figma. The fact that Microsoft
| doesn't compete with Figma is precisely why it's ok for
| the former to acquire the latter.
| meowtimemania wrote:
| Microsoft seems to be pretty hands off when it comes to
| acquisitions. Github/LinkedIn were both a acquired and
| each have grown a lot since the acquisition.
| macspoofing wrote:
| I disagree.
|
| If I was Figma, and I had to choose, I would go with Adobe.
| Adobe would have made Figma a core strategic product and
| would have made them much more relevant in a space that
| they deeply care about. Microsoft would never care that
| much about Figma, because the design/UX space isn't core to
| Microsoft. Also, Figma is too small for Microsoft to make
| it a centrepiece of any of their strategic initiatives.
| vickychijwani wrote:
| Interesting thought - why do you say Microsoft?
| cartermatic wrote:
| It's rumored Dylan Field (CEO of Figma) approached Microsoft
| [1] around the same time they were talking to Adobe but
| Microsoft declined to make a deal at the time (seemingly due
| to Microsoft's then in-process $69billion acquisition of
| Activision Blizzard).
|
| [1]: https://www.cnbc.com/2023/01/11/microsoft-looked-at-
| figma-bu...
| nbzso wrote:
| I am opening a bottle of champagne as we speak.
|
| It is time to remove electron based app and invest in something
| that will have a proper memory management. Not only 2gb. My phone
| has more than this.
|
| You have cornered the market. Now deliver.
| pier25 wrote:
| It's amazing though. The performance of Figma is better than
| all native vector apps out there.
| nbzso wrote:
| Yes and no. Everything is fine until you hit the 2gb limit.
| The average professional laptop has a 16gb ram. Figma is not
| only the vector app. If someone wants serious vector work,
| Illustrator and Affinity Designer provide a solution.
|
| Figma is more than this, and the complexity of the workflows
| requires offline support and more memory available to the
| app.:)
| spiderice wrote:
| Has performance in Sketch fallen in recent years? I know it's
| not as popular any more, but years ago when I used Sketch the
| performance was always top notch.
| pier25 wrote:
| I used sketch around 2017-2018 and the performance was
| really bad. Much worse than Illustrator. At the time I was
| on a top of the line 5K iMac.
|
| Currently on an M2 Pro MBP and Figma is more responsive
| than Affinity Design. The latest versions of Illustrator
| have had a bunch of GPU rendering issues that affect
| performance. In fact these issues were the reason I started
| using Figma.
| yangity wrote:
| I tried to cancel an Adobe CC subscription the other day and they
| wanted to clawback $60 for a $120 yearly subscription. And their
| customer support wasn't helpful at all. Needless to say, we don't
| need more of this kind of behavior, especially with Figma!
| willsmith72 wrote:
| I've been there too, it turns out to be a battle of
| persistence.
|
| I just kept the chat window open for 3 hours one afternoon
| while working, replying every 5 minutes that no, it wasn't
| acceptable, and I wouldn't pay anything. Slowly they started
| reducing the amount until they got to 0.
|
| At points they got extremely aggressive, but from reading other
| people's stories online, that's just part of their training.
| pointlessone wrote:
| Figma got out better than it was before. It's still a strong
| product. And Adobe abandoned XD basically giving up this market
| to Figma.
| bryancoxwell wrote:
| Not to mention the $1 billion termination fee Adobe now owes
| them.
| echelon wrote:
| Figma's employees are probably devastated and demotivated.
| Their exit dollar signs just went poof. And they've probably
| been working on Adobe's roadmap / integration for the past 15
| months.
|
| I'm not so sure Figma is in a better spot, even with this new
| cash in hand.
| bryancoxwell wrote:
| Oof, that's a really good point. That would be utterly
| demotivating.
| gunapologist99 wrote:
| Instead imagine that the workers actually did get that
| huge chunk of cash but _still_ had to come into work
| every day.
| echelon wrote:
| But that's Adobe's problem instead of Figma's and the
| employees'.
| gunapologist99 wrote:
| Good point, and I agree, but nevertheless the product
| itself will probably suffer less in the current
| situation, and meanwhile Figma gets another bite at the
| apple down the road, and that might be a MUCH bigger bite
| and apple later.
| Applejinx wrote:
| What if some of the people behind this very effective and
| successful tool are there because they're enthusiastic
| about the work they're doing?
|
| I'd bet cash money that there are at least _some_ for
| whom the paycheck means they can do their thing and not
| have to take a day job. These are the sorts of people who
| create a Figma instead of an enshittification.
|
| The trick is always to get paid something instead of
| having to get a day job. And I'm sure there are folks who
| 'have to come into work' and are still doing good and
| worthy jobs... but man! You figure they are all like
| that? At Figma, of all places?
|
| Never work in the music business, is all I can say. Or
| filmmaking. There are entire industries that ride on the
| ability to wildly underpay talented people just so they
| can do the things they're excited about doing. Far from
| 'not promising a huge payout', you can absolutely screw
| large numbers of people if they get to hear the band
| play, or get to look through the viewfinder and see the
| rushes.
| avarun wrote:
| It would be illegal for them to be collaborating with
| Adobe in any way on roadmap before the deal closed.
| dijit wrote:
| > and they've probably been working on Adobe's roadmap /
| integration for the past 15 months.
|
| $1B would be enough to cover that completely, but as a
| person who has been in companies that have been acquired.
| (multiple times), that's not really how it works.
|
| I've never worked anywhere that started working on
| integrating or unifying roadmaps before the contracts were
| inked and the deal fully ratified.
| hn_throwaway_99 wrote:
| > I've never worked anywhere that started working on
| integrating or unifying roadmaps before the contracts
| were inked and the deal fully ratified.
|
| Because it's not really legal. I've been a similar
| situation previously, and we were _specifically_
| forbidden from working on any integration projects until
| the deal closed, as in the legal department gave a
| company-wide presentation on exactly what kind of work
| was and wasn 't allowed (e.g. obviously execs/legal folks
| could work towards completing the merger, but working on
| actual engineering integration was expressly forbidden).
| ska wrote:
| > nd they've probably been working on Adobe's roadmap /
| integration for the past 15 months.
|
| That seems highly unlikely.
| wentin wrote:
| They were not devastated or demotivated. The morale is
| still high from what I heard from the inside. 1B is 5% of
| the original deal. Without liquidating any equity, they can
| get 5% of the original payout, which is still large! (I
| think Dylan Field the CEO might do this, to make the team
| happy. I can imagine the outside investor being left out on
| this, since this is not a liquidation event, then even more
| "free" money for the team)
|
| Also, they are not working on any Adobe roadmap. Other than
| a few offsite brainstorm session, no real work has been put
| into integrating with Adobe.
| goalonetwo wrote:
| There is a "jump the gun" law that makes it illegal to
| start integrating before the acquisition fully closes.
| danielvaughn wrote:
| I wonder what this does to their valuation? It's not really my
| area so I don't know, but once a company is willing to buy you
| at a certain price, you're kinda "worth" that price right?
| pcurve wrote:
| There was only one company to which Figma was worth $20
| billion and that was Adobe, because it was a long term
| threat.
|
| I just hope Google or Msft doesn't get any funny idea to buy
| Figma.
| danielvaughn wrote:
| I could definitely see MSFT making an attempt, to bring
| Figma + VSCode closer together.
| Aerbil313 wrote:
| Sush... don't give them any ideas
| hn_throwaway_99 wrote:
| In all fairness, I thought GitHub got tons of useful
| features after the acquisition. The stability definitely
| felt like it suffered, but I kinda just chalked that up
| to growth and difficulty stabilizing new features. But at
| least recently its stability seems to have improved (no
| jinxing...)
| serial_dev wrote:
| Microsoft acquisition makes sense. GitHub is basically
| Figma for developers, and they are one of the most solid
| AI players out there.
| max_ wrote:
| This really makes me sad as an aspiring entrepreneur.
|
| What would be the use of starting a business if the government
| can arbitrarily block it from being acquired?
|
| I understand this happening in Europe but not America.
|
| I think America is going to lag behind in tech entrepreneurship
| just like Europe and I wonder what the next potential tech
| entrepreneurship hub will be.
| ivanjermakov wrote:
| Why would you start a business with the end goal of selling it?
| mwidell wrote:
| Perhaps you could aim to actually make money through your
| business? As in, selling a product at a profit? Taking
| dividends? I know it sounds wild, but that's how it went down
| in the olden days.
| niek_pas wrote:
| How is this 'arbitrary' ("based on random choice or personal
| whim, rather than any reason or system")?
| replwoacause wrote:
| Is the main goal for every entrepreneur to be acquired? Also,
| there is nothing "arbitrary " about antitrust laws.
| danieljacksonno wrote:
| The use would be to make a profit
| corry wrote:
| Ummm. This seems like a huge overreaction. Do you think the
| founder of Figma -- which is still worth $B's, making him
| obscenely wealthy 'on paper' (but 'on paper' in a way that most
| wealth is counted) -- plus, he likely sold enough via
| secondaries during the later rounds to be set for life -- is
| bemoaning his career path?
|
| Furthermore, there's something like 20k M&A deals / yr
| completed in North America alone, the majority that are still
| life-changing wealth creation events for the founders.
|
| So don't despair - 1 problematic anti-competitive M&A deal
| blocked by the government does not signal the end of
| entrepreneurship in the US.
| jongjong wrote:
| What I find most sad about entrepreneurship is that almost
| all the successful founders appear to have been 'chosen' by a
| famous VC or investor. It's almost like what you do doesn't
| really matter. I've seen some 'chosen entrepreneurs' keep
| failing and they keep getting second, third, fourth chances
| and eventually succeed. Being chosen seems to be the most
| important element for success. But how to become chosen? It
| seems so random, in a world of 8 billion people, you need to
| be hand-picked by one of maybe 100 people... And the criteria
| is weird; basically they need to like you and for that to
| happen, you basically need to remind them of a young version
| of themselves... Which is not something you can control.
|
| If you're very different, none of the famous investors will
| like you (that's assuming they even learn about your
| existence) and your chances in this industry will be very
| bad.
| corry wrote:
| Hey friend - you're wrong on this, although I understand
| how it might be comforting to think this is all some vast
| elite conspiracy.
|
| The reality is that you "become chosen" by building a
| company that is growing very quickly in a big market.
| That's it.
|
| Most successful startups didn't wait around for some name-
| brand VC to pick them (that's the most anti-entrepreneur
| mindset I can think of). The big funding happens much later
| than the initial traction and momentum.
|
| Yes, you have to be personable enough to be able to talk to
| clients, investors, recruit top talent, etc -- but that's
| not the VC arbitrarily choosing whether they like you or
| not -- that's a cold reality of being a great founder.
| jongjong wrote:
| I don't believe that for a second given how tightly
| controlled all the social media and search engines
| algorithms are. I've never met anyone ever who built a
| successful software company who wasn't well connected to
| some elite.
|
| How is that a comforting thought? It's difficult to
| imagine anything more disturbing. At least if I admitted
| I was just a failure by my own hand, it would be much
| easier as I could try to improve myself. It would look
| like there is a small chance. That would be far more
| comforting.
| InsomniacL wrote:
| It's not been arbitrarily blocked.
| barnabee wrote:
| Maybe you're an aspiring entrepreneur for the wrong reason,
| then.
|
| Start a business to solve a problem.
|
| If you really build something users like, with a decent market,
| you will do fine (as will/have the founders of Figma).
|
| If you hope to use getting "acquihired" to get rich even if you
| fail, then sorry, the world doesn't need more founders like
| you.
| Vespasian wrote:
| I am currently working for a company with a few thousands
| employees around the world.
|
| The founder is still the CEO owning a majority of shares and
| his second and third in command (or their families) hold most
| of the remaining shares. He's getting close to retirement and
| probably will do so in a few years passing the torch on to his
| children.
|
| AFAIK he came from a very upper middle class background but not
| real wealth and kept the company alive by being profitable (not
| Tech margins though). That seems to be a quite sustainable
| business model that made him, his cofounders wealthy enough to
| not worry about money even we'd close tomorrow.
|
| Nothing wrong with that and certainly something an aspiring
| entrepreneur could aim for. It's more difficult though and you
| need to run a tight ship at times and actually think longterm
| and how to sustain your business.
| dahart wrote:
| There seems to be some misconceptions here. This wasn't
| arbitrary. Most acquisitions are not blocked. The US government
| can block a lot of things for companies, but is generally
| speaking pro-business. That said there's a longish history of
| regulating monopolies, in order to benefit consumers and the
| economy, so no evidence of a new trend wrt Europe based on this
| case. (Consider whether that history may be part of why the US
| had a lead in tech entrepreneurship in the first place.)
| codeptualize wrote:
| That is wild. It's a good thing as it means Adobe won't ruin
| Figma like they did with so many great software products before,
| but just imagine founders, investors and employees, thinking they
| had a really good exit.. That must hurt, I hope they can stay
| motivated.
|
| If Adobe can't buy them, what other exit options do they have? Go
| public?
| sowbug wrote:
| What's wrong with selling goods and services for more than they
| cost?
| codeptualize wrote:
| There is nothing wrong with that if that is the type of
| company you build from the start. VC funded startups
| generally want to have an exit/IPO to get a return for their
| investors and give their founders and employees an
| opportunity to cash out and de-risk. Without an exit or IPO
| that is a lot harder, especially for employees.
|
| It's about the expectation of everyone involved.
|
| Eventually every company needs to turn a profit, so for the
| company it might not make that big of a difference or even be
| better (if they can turn a profit which I assume Figma can),
| but for the investors and individuals involved it's a very
| different situation as it means their capital is pretty much
| stuck. And I bet a $20B exit would be life changing money for
| a lot of people involved.
| david38 wrote:
| "Everyone involved" includes customers
| codeptualize wrote:
| Those should also know that this is a VC backed company
| that is going to try to provide a return on investment at
| some point.
|
| I do think its the right outcome and better for
| customers, the government is doing what it needs to do.
|
| But I still empathize with the people involved.
| heyoni wrote:
| I think the issue is that when you buy up your competition
| there's nothing stopping you from charging obscene prices in
| either direction. Charge low to wipe out potential
| competitors then high when there's no one left. It very
| clearly stifles innovation and god knows we don't regulate
| monopolies anymore.
| todd-davies wrote:
| Dropping prices below cost to wipe out competitors is
| predatory pricing which is prohibited under the antitrust
| laws. It's not always easy to prosecute, but it against the
| law nevertheless.
| tqi wrote:
| What does that mean when it comes to software though? For
| something like Uber or Instacart that seems pretty
| straightforward, but for most tech companies I'm not sure
| how to determine what is predatory. Otherwise aren't all
| unprofitable companies selling below cost?
| todd-davies wrote:
| Yes, it's a bit of a problem for the field! Like many
| aspects of antitrust, predatory pricing applies cleanly
| for an industrial-era economy but as you point out, it's
| less clear how to translate it into the context of 21st
| century informational capitalism. A significant amount of
| legal and economic research in the field is asking these
| kinds of questions, and the answers are still
| forthcoming.
| tqi wrote:
| Got it, that makes sense that its not well established. I
| saw from your profile that this is actually something you
| are studying, which is very cool! I've always wondered
| what the examples of this (predatory pricing -> drive out
| competition -> jack up prices) happening in practice are?
| I know Uber is the ur-example but that feels different
| from something like pure a saas?
|
| I wonder if as long as there is VC money out there, the
| viability of this strategy is limited because the moment
| incumbents (even ones with overwhelming market share) try
| to jack up prices, they immediately create an opportunity
| for a startup to undercut them.
| todd-davies wrote:
| I can't think of a good example for a sass product. I'm
| sure it goes on though and I'm always interested in
| hearing about examples!
|
| A similar strategy which seems to be quite common these
| days is to cross-subsidise, which is when a firm sells
| one product at an artificially low price by using profits
| it makes from selling another product. If we think about
| cross-subsidisation, then lots of multi-product sass
| offerings might fall under our scope. That said, cross-
| subsidisation has economic benefits, so it's not clear-
| cut.
|
| As I said, to properly adjust to digital markets I think
| antitrust will have to identify new patterns of harm and
| invent new metrics to measure them. Predatory pricing
| (and similar offences) will always be useful, but they
| might just not fit well onto these kinds of markets.
| tqi wrote:
| It seems like the implicit assumption is that there must
| be a harm somewhere, we just haven't found it yet. But as
| a consumer, I'm not sure that is true? Even the Amazon
| paper seems to admit that there isn't any consumer harm
| to be found, only harm to smaller competitors'
| businesses. But that feels like an odd standard to apply
| since isn't any business's primary purpose to compete
| with / harm competitors?
| todd-davies wrote:
| > It seems like the implicit assumption is that there
| must be a harm somewhere, we just haven't found it yet...
| isn't any business's primary purpose to compete with /
| harm competitors?
|
| As a general rule, firms want to escape competition in
| order to make higher profits. There's nothing wrong with
| that! Indeed, the mechanism by which economic competition
| generates many of its benefits is that firms innovate in
| order to escape competition, and for those innovations to
| be useful for us all. So, where does
| competition/antitrust law come in? In part, it's about
| ensuring that firms escape competition in the way that we
| want. Innovation and competition on the merits is good,
| underhanded tactics to harm competitors is bad. All
| competitions need these kind of rules, regardless of
| whether they're economic, political, sporting, etc. When
| you have a large population of thousands of firms, you
| can be sure that some of them will be trying to compete
| unfairly, hence the assumption that there is some harm
| that we're yet to find.
|
| > there isn't any consumer harm to be found, only harm to
| smaller competitors' businesses
|
| We can distinguish between 'static' and 'dynamic' harms.
| Static harms are those which happen in the short run,
| such as a cartel agreeing to increase prices or not
| innovate. These harms are quite concrete and easy to
| define. Dynamic harms are those which affect the way a
| market might function in the future. For instance, a harm
| to innovation may result in people not having access to
| new products. It's hard to say for sure whether these
| harms will actually manifest, so we're usually talking
| about tendencies instead of certainties. It's perfectly
| reasonable to consider tendencies under the law though
| (e.g. we might prohibit drink-driving for the same
| reason). Dynamic harms usually have harm to consumers as
| a second order effect (e.g. reduced innovation or
| choice).
| tqi wrote:
| Thanks for the thoughtful and clear explanation!
|
| The analogy to drunk driving makes sense, but in the
| context of business is it so important to get ahead of
| the harms that we have to legislate against pre-harms?
| Innovation and merit and underhanded tactics are in the
| eye of the beholder, and it seems like we apply a LOT of
| preexisting notions of who is a good company and who
| sucks when we evaluate behaviors. That doesn't feel like
| a sustainable way to write and enforce laws.
| Applejinx wrote:
| No, in several ways.
|
| Firstly, I didn't spot what paper you mean other than
| 'related to Amazon', but it's plain to see what can
| happen to an Amazon. Once it's finished destroying
| competitor businesses the only way it can get more profit
| is by continuing to get paid, but ceasing to deliver
| services. And this is already happening in various ways.
| I'm sure I'm not the only person, even on Hacker News, to
| have grudgingly written off an Amazon purchase that
| simply never was delivered, a cheap and trivial thing
| that didn't pan out, a 'problem with this order' that the
| system simply ate.
|
| At the point when you're taking consumer money and not
| having to do anything, that's harm. You can get away with
| it because your system is invincible. (I also feel like
| this about the insurance industry: I think it's set up to
| not pay, and has better legal representation than the
| consumer does)
|
| To the extent that a business's primary purpose is to
| make money, these are successes. To the extent that the
| primary purpose is to hurt competitors, these are still
| successes, to the extent they're possible and not just
| undermining your position: you have to be monopolistic or
| at least in control to be able to pull that stuff off,
| but then you're wealthier, giving you more power to hurt
| competitors.
|
| None of this serves a market economy for providing goods
| and services. It may exist, but it hurts _capitalism_ as
| a functioning concept.
| tqi wrote:
| > I didn't spot what paper you mean other than 'related
| to Amazon'
|
| Lina Khan (FTC chair) wrote an influential paper called
| The Amazon Paradox laying out a new antitrust doctrine
| which argues that rather than consumer harm, the standard
| for antitrust should be harm to competitors.
|
| > it's plain to see what can happen to an Amazon... you
| have to be monopolistic or at least in control to be able
| to pull that stuff off, but then you're wealthier, giving
| you more power to hurt competitors.
|
| "Can" happen is not the same as "has" or "will" happen.
| If they are causing consumer harm, they should be
| punished. But as far as I can tell, there hasn't really
| been strong evidence of that yet (your example of a bad
| delivery experience is not unique to Amazon), and I don't
| think we should punish pre-crimes. Ultimately, it feels
| like you and many others are starting from a position of
| "Amazon et al should not exist" and working backwards to
| a justification.
| whimsicalism wrote:
| Genius, just make it illegal to be unprofitable.
| unethical_ban wrote:
| What are you replying to?
|
| edit: Got it. I just woke up when I asked.
| saghm wrote:
| I think they're responding to the question "If Adobe can't
| buy them, what other exit options do they have? Go
| public?". It's a bit tongue in cheek, but it's a fair point
| that we're in a weird place if the idea of founding a
| company with the goal of being sustainably profitable
| indefinitely rather than just being acquired by a much
| larger company is somehow the suboptimal backup plan rather
| than the main goal.
| quasse wrote:
| The parent comment poses a question: > If Adobe can't buy
| them, what other exit options do they have?
|
| Operating as a sustainable business that sells a good
| product for a profit is apparently not even on people's
| radar.
| hn_throwaway_99 wrote:
| I think this is my favorite comment of the year. We've all
| become so inured to the idea, especially in startup land,
| that the purpose of building a business is just the exit (and
| hopefully we can get out soon enough with someone else
| "holding the bag").
|
| As you point out, if Figma can build a growing, profitable
| business, there is no reason they can't IPO at some point.
| But still, this shows how even the purpose of an IPO these
| days is completely opposite from the original intention. I.e.
| the original intention was to get access to public market
| funds to grow a business. Now it's usually just a method of
| "exit" to let retail investors take the lion's share of the
| risk - one only need to look at 95%+ of the past few years'
| SPAC deals to see how much of a "pump and dump" the market
| has become.
| endtime wrote:
| > that the purpose of building a business is just the exit
|
| The majority of those affected negatively by this are not
| the founders, but the employees. Many of them may have
| turned down FAANG positions that come with predictable
| liquid RSUs. Some may have kids (in fact, I know someone at
| Figma who had a kid in the past year).
|
| Liquidity's not necessarily about opportunistically passing
| on risk...sometimes it's just about making a competitive
| living relative to being at a public company.
| EricDeb wrote:
| Any chance figma can go public?
| neom wrote:
| I'm sure these 30+ people want their 330+ Million dollars
| back with "profit", they need to find an exit somewhere.
|
| https://www.figma.com/blog/figmas-series-e/
| EdwardDiego wrote:
| Figmates... oh God.
| hn_throwaway_99 wrote:
| I don't disagree with what you're saying, at all, but the
| implication is still basically "And employees want
| someone else to be a bag holder, too!"
|
| And having been in that position several times, I
| definitely don't blame them! Employees also have the much
| tougher constraints that they can't diversify their
| employment like VCs can diversify their investments.
|
| But still, it's the same dynamic that people want to get
| rich, and the downstream consequences be damned.
| amrocha wrote:
| In practice, employee shares in a private company are not
| an "investment" because they can't be traded in an open
| market. So no, employees don't want someone else to hold
| the bag. Employees want a return on their investment, and
| the most viable way of doing that is through an exit.
| hn_throwaway_99 wrote:
| That's the whole point though - employees want an exit
| event so they _can_ sell their shares and have someone
| else holding the bag.
| crandycodes wrote:
| That seems like an odd way to frame it, imo. "Holding the
| bag" usually implies something negative, as in someone
| will be "caught" with something bad. As in the employees
| are looking to dupe someone into buying what they are
| selling. But employees, outside of company officers, do
| not control what information investors get about what
| they are buying. They can't trick anyone into buying
| something, although they could theoretically benefit if
| someone else did trick buyers.
|
| But it's a weird take, because employees are already the
| ones "holding the bag". Office space, cloud compute, etc.
| are all sold as COGS. VCs usually have some ability to
| sell their shares on the private market since they can
| negotiate to get their capital. Employees are often the
| only ones which are taking an IOU for their time and
| effort compared to what they could get elsewhere in the
| market. Employees are often the lowest class of shares
| which get paid out last and often reliant on the board to
| be able to sell on the private market. Yes, the employees
| decided to take this offer, on good faith, that their
| management would look after them. They are adults who
| made a, theoretically, informed decision. But
| structurally, they are set up to be the ones "holding the
| bag" if things were to go wrong with an exit.
|
| So of course they want an exit. They literally have no
| other choice to get a return on their time/effort than
| for that to happen. (or some odd third thing like private
| dividends, but again, they have practically no control
| over that happening)
| kelnos wrote:
| > _They literally have no other choice..._
|
| Sure they have (had) another choice: they could have
| taken employment at a more stable (possibly public)
| company, where compensation would have been more
| predictable.
|
| But they chose to work at a smaller, private company, and
| accepted private-company equity as part of their
| compensation, which 9 times out of 10 ends up being worth
| zero dollars. This idea that they're somehow entitled to
| a payout is ridiculous.
|
| The situation that the VCs and founders are in is often
| enviable, but isn't really relevant here. Regular
| employees need to be financially responsible about
| accepting jobs with private-company equity comp, and not
| expect miracles. That's the bottom line.
|
| (I agree that "holding the bag" is a weird way to frame
| this, though.)
| crandycodes wrote:
| > The situation that the VCs and founders are in is often
| enviable, but isn't really relevant here.
|
| Respectfully disagree. It's relevant to the extent the
| parent comment was talking about employees wanting to
| have someone else "hold the bag".
|
| > Regular employees need to be financially responsible
| about accepting jobs with private-company equity comp,
| and not expect miracles.
|
| Agree that it's their responsibility and no one should be
| starting a kickstarter for them or anything. But that
| doesn't mean you can't sympathize with them. They are
| often fairly young people who aren't experts on contract
| law. It's not unreasonable to say that at least some of
| them have been exploited with excessive promises. The
| industry would be a better place if rather than say "they
| should have known better", we instead said "employers
| shouldn't exploit people". A precedent of bad behavior
| shouldn't excuse it.
| Earw0rm wrote:
| Yep, shares are part of the comp package, it's entirely
| natural that employees want to turn the fruits of their
| labour into liquid cash at some point.
|
| There is a valid argument that that's a perverse
| incentive, and that companies should just pay employees
| better to begin with, or have various
| longevity/performance-associated bonuses, but if the
| company isn't profitable, share value is perhaps the best
| way to represent that.
|
| And on top of that, employee share schemes tend to get
| very favourable tax treatment. So overall "skin in the
| game" is no bad thing, the problem is that, in many/most
| cases, an exit is the only way you're going to get your
| skin back out of the game.
| philosopher1234 wrote:
| Employees have much higher risk profiles, even if they
| hold no shares at all, than"bag holders" because they
| tend to have 100% of their families financial well being
| invested in a single company. Virtually no investors have
| even close to such a big bag holders
| amrocha wrote:
| What does it matter if Figma employees have kids? Having
| kids is one of the most common human experiences.
| kelnos wrote:
| And that's the risk/bargain those employees accepted when
| they took the job at Figma rather than some public
| company with predictable equity comp.
|
| Look, it sucks, I get that. I was an employee at a
| successful startup that did end up going public and made
| me a bunch of money. But I also worked at three other
| startups that didn't go anywhere and my options/stock
| ended up being worthless. I also worked at a "boring"
| public company with equity comp that amounted to a pretty
| small (but helpful!) quarterly bonus.
|
| I accepted each of those jobs knowing what I was getting
| into, and knowing that I probably wouldn't see any kind
| of big payday (the one where I did was life-changing, but
| if that hadn't happened, I'd still be fine, financially).
| That's the nature of the beast. It's disappointing when
| it doesn't work out, but don't play the "some of them
| have kids" card: people need to plan their finances based
| on normal, expected outcomes, not on the moonshot.
|
| And regardless, Figma still seems like a great company,
| with great products. Employees will still likely do
| really well, whether through a different acquisition or
| by going public. They'll just have to wait longer.
| Drew_ wrote:
| > The majority of those affected negatively by this are
| not the founders, but the employees.
|
| Well yes there are typically many more employees than
| there are founders. Despite this, founders probably
| missed out on orders of magnitude more money than all of
| the employees combined.
| kalleboo wrote:
| Most people who have kids make a fraction of the average
| salary at figma, I don't see how they are sacrificing
| anything
| Gooblebrai wrote:
| Totally agree with you. It feels like nowadays businesses
| are not really about making a profitable business. But
| about vanity metrics and get a huge exit ASAP even if the
| business doesn't really survive without VC injections.
| solatic wrote:
| > the original intention was to get access to public market
| funds to grow a business. Now it's usually just a method of
| "exit" to let retail investors take the lion's share of the
| risk
|
| Founders and employees would be totally OK with staying
| private, if the board would ever permit issuing a dividend.
| That's the "normal" way to have an "exit" (i.e. return
| profits to shareholders) without a public offering. The
| purpose of delaying issuing a dividend is to reinvest
| profits / additional fundraising for growth, but that
| growth should still result in a dividend in the future,
| just a larger one if the investment in growth succeeds.
|
| Instead, founders and employees are encouraged to look
| forward to an IPO precisely because somehow we've come to
| believe that it's sinful for a company to issue a dividend,
| as if doing so means giving up on the idea that further
| growth is possible, when really it's only an
| acknowledgement of the fact that (a) there's a healthy rate
| of growth, (b) that healthy rate of growth costs $X, (c) if
| the company has $Y cash >> $X growth cost, then the healthy
| thing to do is to issue a dividend (so that shareholders
| can invest the excess into companies that are currently
| better recipients), rather than attempting to force growth
| faster than the company can support.
| TheNewsIsHere wrote:
| This is good analysis. As the owner of a business, I
| often find myself bewildered at the valuation-centric,
| IPO-gazing startup culture that has developed especially
| in tech.
|
| Most businesses in technology are nothing like the VC-
| funded, exit-oriented, and/or hyper-growth culture would
| have you think. Yet it seems like the glitz of a great
| IPO or being able to shell out for a $200 million annual
| corporate event blinds many to the reality of most
| businesses.
|
| I have wondered how much of this naivete contributes to
| the failure rate of technology startups.
|
| I'm on my second business and I intend for it to be my
| last, though time will tell. The key thing I've learned
| is that hyper-growth, IPOs, and VCs aren't really good
| for anyone other than the equity holders. Once you start
| selling ownership in your business, your customers are no
| longer your first North Star.
| kelnos wrote:
| In the case where a private company has issued options or
| shares as a part of compensation, another way to pay back
| employees would be to do a stock buyback program. E.g. if
| I was an early employee and got options with a $1/share
| strike price, but the current going rate for new-employee
| options is $5/share, the company could offer to buy back
| my options from me at $4 each (or if I'd exercised those
| options, they could buy the shares back at the full $5
| price).
|
| If the general understanding was that the founders (well,
| board) weren't chasing an acquisition or IPO, this might
| be a good deal for employees. Of course, if the company
| is VC-backed (and the founders don't have majority
| control anymore), the VCs probably wouldn't go for this
| sort of thing.
|
| I do actually wonder if the current trend of
| consolidation is driven in part by the standard VC-backed
| startup formula. Getting acquired is usually a lot easier
| than going public. Instead of startups fueling long-term
| competition, they just end up getting gobbled up by
| larger players most of the time, fueling consolidation
| and monopolistic behavior.
| financypants wrote:
| Unfortunately if you have VCs on your capitalization
| table you can pretty much never issue dividends as a
| private company
| throwup238 wrote:
| As if the employees would ever see any of that dividend.
| If startups paid out dividends, VCs would require them to
| be part of the liquidation preference clause.
|
| IPOs and huge sales far above the liquidation preference
| is the only way any of the employees would see any of
| that money.
| kpandit wrote:
| My favourite comment as well in this world so full of pump
| and dump shows. The mentality is so intrenched that if you
| are not one of these pump and dump shows with an exit
| strategy then you are labelled a lifestyle business instead
| of a proper "startup".
|
| [Off topic] That is some throwaway account with 60k+ karma
| and almost 7 years in age.
| codeptualize wrote:
| There are lots of pump and dumps but this one isn't a
| pump and dump. Figma was founded in 2012, they pretty
| much took over UI design, did $400M ARR in 2022, great
| retention, rapid growth, great margins, there is a lots
| of actual value there and still quite a bit of potential
| left.
|
| A "proper" startup does indeed include an exit as that's
| the point where they give a return on investment to their
| VC's. That is the startup game, use the VC money to
| accelerate growth, then exit/go public.
|
| Not saying I like it, but once you take the VC money that
| is the game you play.
| kpandit wrote:
| My bad. I was just responding to the parent comment and
| the comment(by showbug) they were replying to in
| isolation. Figma is a product I liked and was so terribly
| disappointed with the news of acquisition by adobe.
|
| Regarding startups, I just did google "define: startup"
| and in the dictionary definition there has no VC and no
| exit.
| porridgeraisin wrote:
| What the dictionary says is completely irrelevant.
| codeptualize wrote:
| We can debate definitions and labels but that's not
| really relevant to the discussion imo, name it whatever
| you want, what I'm referring to is a company taking VC
| money to accelerate growth.
|
| Once you take VC money, like Figma did, your goal is a
| lucrative exit.
|
| It's high risk, high reward. It's a different way to
| build a company, and it's not really possible to change
| that once you take that route.
|
| Doesn't mean you have to do this. I am all for building
| steady profitable private companies that aim for the long
| run, I think it's a great way to build great companies,
| but then you should stay far away from VC money, take a
| lot less risk, have different compensation strategies etc
| etc.
| cco wrote:
| That's the intended outcome of the incentive structure of
| startup compensation.
|
| Sometimes more than half of your expected compensation at a
| startup is in equity upside, either from an IPO or
| acquisition.
|
| If that is to no longer be the expectation, then hiring at
| startups will be _much_ more challenging because startups
| cannot generally afford the salaries or benefits that
| larger companies can offer.
| frozenport wrote:
| that is already the case, with unlimited equity you're
| basically working on the founders dream in exchange for
| dilution
| pesfandiar wrote:
| It doesn't make anyone rich quickly.
| shostack wrote:
| Well, if you're an employee joining because the stated path
| is to find a successful exit vs build a sustainable business,
| your comp expectations may have reflected that and been lower
| than normal.
| cipheredStones wrote:
| Stocks of successful companies typically pay dividends.
| That's what makes them valuable in the first place. Not
| being able to sell them just means you can't get the value
| up front as a lump sum.
| atomicnature wrote:
| Sanity prevails, at least in some HN comments; this is why I
| come to HN :)
| newsclues wrote:
| It's hard work!
|
| Much easier to give things away for free and sell the
| company.
| stephenr wrote:
| Careful now, you'll give someone an aneurism with talk like
| that, dontchaknow?
|
| On a serious note, it's depressing how much a comment like
| this stands out from the crowd.
| bdcravens wrote:
| Unfortunately taking investment means you are accountable to
| their interests, not just your own. This includes the
| employees whose investment was opportunity cost.
| sackfield wrote:
| The employees are sold shares in the business that they
| expect to accrue a certain amount of value and with scale get
| very serious multiples in a liquidity event. With that
| promise broken the value proposition they originally signed
| up for no longer holds, some perhaps wasted the best years of
| their lives here when other options were on the table. If all
| you want to do is sell goods and services for more than they
| cost, then open up a bakery.
| occamsrazorwit wrote:
| > If all you want to do is sell goods and services for more
| than they cost, then open up a bakery.
|
| What's the endgame to ever-increasing share value exactly?
| It's easy to say that a company should never stop growing,
| but there's no way that's a realistic ideal.
| chipgap98 wrote:
| There are other ways to give employees liquidity without
| being acquired or going public
| Drew_ wrote:
| > The employees are sold shares in the business that they
| expect to accrue a certain amount of value and with scale
| get very serious multiples in a liquidity event.
|
| Sounds a lot like a pyramid scheme
| golergka wrote:
| Owning just one company that does that has a much worse risk
| profile than owning a little bit of many companies that do
| that. That's why founders, angel investors and employees want
| to sell their share of the company to a huge fund and then
| invest their money back in that fund.
| paulddraper wrote:
| Nothing.
|
| Unless you are VC-funded. Because VCs expect+need an exit for
| their LPs.
| Applejinx wrote:
| Yes, thank you...
|
| I could even prune that down some more. What's wrong with
| selling goods and services?
|
| Not as a means to the accumulation of enough wealth to cash
| out and cease selling goods and services, which is what the
| startup world is trained to do. There's this hyper-focus on
| financialization, in that nothing means anything beyond the
| eventual payout, and all things are designed to either
| succeed or fail at going public and delivering that jackpot.
|
| What about... doing the thing? Making a good, doing a
| service? What if that thing is in itself a thing to do, a
| purpose to have? In that case if you are either breaking even
| and retaining control, or amortizing the cost against
| something else, then you're pursuing some kind of idea that
| is not itself 'money'.
|
| Why not that? Why not, directly, a thing that isn't money?
| I'm given to understand the idea of money is to accumulate
| the power and resources to do whatever _thing_ your dream
| envisions. Well, how about cut out the middlemoney and do the
| thing?
| Vervious wrote:
| why not go public? That would also probably be in the public
| interest.
| mortenjorck wrote:
| I doubt we'll see anything in the next 12-18 months, but at
| some point in 2025-26 I would expect one of the following, in
| order of likelihood:
|
| 1. Microsoft acquisition
|
| 2. IPO
|
| 3. Salesforce acquisition
|
| The above are also in descending order of valuation. Adobe's
| $20B was pure pandemic-bubble premium; I doubt MSFT would pay
| much over half that, Salesforce less still, with an IPO
| somewhere in the middle.
|
| The more interesting thing to me is actually what Adobe is
| going to do now, given their near-wind-down of XD. Narayen has
| almost certainly thought of this, and while it may not exactly
| be Adobe's typical MO... the opportunity they have now is the
| old "commoditize your complements." Specifically, to become the
| biggest corporate sponsor of Penpot.
|
| I generally doubt they will, as it's not really in Adobe's DNA,
| but they _could,_ and it would be quite an interesting turn of
| events.
| codeptualize wrote:
| 1 & 3 would be horrible as well.. I think they would ruin it
| properly.
|
| Indeed, Adobe's actions will be interesting. They will have
| to compete, maybe they can buy Sketch or similar?
|
| And they might also just want out of the $20B price tag as
| you are right that it's a crazy price today.
| pixelbath wrote:
| Figma's press release doesn't mention it, but they've now got
| an extra $1bn from the merger termination fee to bank, so
| presumably they could reinvest that into the company and
| stakeholders.
| Dylan16807 wrote:
| They just got a billion dollars as a breakup fee. A billion
| dollars could be: $500M to early investors, $250M to the people
| that built the company, $400k each for anyone employed before
| the merger announcement, $100k each for anyone hired since,
| $50M under a pillow for safekeeping.
|
| And that's without needing to give up ownership. Is that not a
| good 'exit'?
| serial_dev wrote:
| Is there any reason why you think that the billion dollars
| will "trickle down" to the people who would have enjoyed the
| benefits of the merger?
|
| Sure, your hypothetical payout sounds good, especially
| assuming they don't have to give up anything, but it's still
| hypothetical and I doubt that anything close to what you
| described is going to happen with that billion dollars.
| Dylan16807 wrote:
| I don't think it _will_.
|
| But the comment was "just imagine founders, investors and
| employees, thinking they had a really good exit".
|
| If the company cared about "a really good exit" for
| everyone, it can make that happen with a billion dollars of
| nearly-free money. If the company doesn't want to make that
| happen, then why should we expect the merger would have
| made people any happier? What makes this demotivating?
| serial_dev wrote:
| > What makes this demotivating?
|
| My understanding (and correct me if I'm wrong) is that
| the people would have sold their stocks, something that
| is not very liquid and therefore worth less without an
| IPO or merger. Now, with no merger, they can't get "real"
| money for their stocks.
|
| > What makes this demotivating?
|
| Well, maybe yesterday they thought they'd soon have a
| multimillion dollar payout, and all that is gone. I can
| see how that can be frustrating to some.
| bdcravens wrote:
| All of their rounds have added up to $333M; most of that is
| in the past 3-5 years; the early investment rounds were very
| tiny. $500M on $333M isn't the home run that the investors
| were looking for, but maybe in today's environment may be the
| best they can hope for. That said, they may not want to set
| that precedent.
| Dylan16807 wrote:
| They wouldn't necessarily have to give up any ownership, so
| they could keep hoping for a home run to occur later. I
| feel like that's a pretty good deal.
| codeptualize wrote:
| I didn't realize they had a breakup fee. That's is kinda
| nice.
| al_borland wrote:
| If it's not Adobe, won't it be someone else? It seems ike it's
| just a matter of time. I'd think of Figma was looking to stick
| it out as it's own company for the long-term they wouldn't have
| entertained Adobe's offer in the first place. Unless of course
| something during the Adobe deal soured them on the idea of
| acquisitions all together, to the point where they are no
| longer looking for an exit.
| Vicinity9635 wrote:
| Is it just me or is every single merger a cause for
| disappointment and frustration with a government that once
| broke up monopolies, and every single failed merger a cause for
| celebration because it means slower 'enshittification' of
| everything?
|
| I'm still pissed that Morgan Stanley was allowed to buy e
| _trade for some fucking reason and immediately made my entire
| debit card experience worse, and made_ absolutely nothing
| better* for me, the customer.
| Applejinx wrote:
| For what it's worth, it's not just you. I sympathize
| completely. I watch for things like this affecting my life in
| the knowledge that every single time such a merger or
| acquisition happens, it's going to do me some kind of harm
| for no benefit.
|
| Someone got paid for something, and that's the only purpose
| that was accomplished, and that someone wasn't (and never
| will be) me.
| stjohnswarts wrote:
| I agree, this is a big win for Figma customers as they aren't
| hampered by "even bigger" corporate politics and can be more
| nimble. I'm not so sure about stockholders at the companies,
| though. Furthermore, I'm sure they would have liked the boost.
| I don't care much about their stockholders though, they
| certainly don't care about me as a user :) .
| ThomPete wrote:
| I see a lot of people in the thread thinking this is a good
| thing, it's not.
|
| First of all the reason for the UK not allowing the merger is
| completely absurd and based on a false premise which is most
| likely based on not understanding the field they are regulating.
|
| Regulation based on speculation about the future means that
| regulators can simply just make up reasons. Thats akin to when
| kings could just make up reason for their ruling. We were
| supposed to move away from that so that rule of law was the base.
|
| Second, the fact that the UK can kill a deal like this is wildly
| problematic and unfortunately not the first time. They did the
| same with Facebook and Giphy where it made no sense either. It's
| immature and they obviously aren't understanding the field they
| regulate. Talk about undermining the growth of society.
|
| Lastly I see a lot of people saying exits is not a good thing and
| shouldn't be the purpose. But the fact is that a healthy M&A
| culture is good for startups as that will encourage investors.
| Once you start killing the ability for exits by introducing such
| unquantifiable into the settings you are making investors more
| nervous of spending their money and much more risk averse.
|
| Sad.
| airstrike wrote:
| You're surely entitled to your opinion. It doesn't mean you're
| right.
|
| I tend to agree the CMA is pushing some esoteric arguments in
| their rulings, but I don't thinks deal is _at all_ like
| Facebook / Giphy.
|
| "A healthy M&A culture" isn't undone by a single deal being
| pulled, especially when that deal is clearly an anti-
| competitive one.
|
| Also if anything, Adobe overpaid for Figma given it was one of
| the last deals before Tech stocks properly melted, so even
| Adobe shareholders can be happy with this outcome
| ThomPete wrote:
| You are right its not like Facbook/Giphy, it's worse and we
| aren't talking about a single deal being pulled but multiple.
|
| It's not clearly anti-competitive in fact if anything in the
| B2B space M&A done by bigger companies is where products go
| to die and opens up for a whole new set of competitors.
| barnabee wrote:
| There is no way a company Adobe's size should _ever_ be allowed
| to grow by acquisition. At a certain point that route needs to
| be cut off forever.
| ThomPete wrote:
| You don't measure this on the size of the company but on
| market share. By that definition of course it should be
| allowed. There are many powerful competitors in this space
| Canva being just one of them.
| airstrike wrote:
| Canva is nowhere _near_ Adobe. Adobe is _the_ dominant
| software seller for creatives. Figma and Canva are the two
| only notable competitors to have emerged in the past 10
| years or so. Doing away with one of them isn 't better for
| society.
| ThomPete wrote:
| Canva is 5 times bigger than Adobe Express which is how
| you compare the two.
|
| Adobe don't dominate 3D, illustration, ads, video and I
| could go on.
| fauigerzigerk wrote:
| Depending on how exactly you segment the market, Adobe's
| market share is somewhere between 33% and 75%. The runner-
| up is in the single digits.
|
| In my view, the case for blocking this acquisition couldn't
| be any clearer. If Adobe wants to grow in this space, it
| should make better software or cut prices or both.
| ThomPete wrote:
| You have to segment it into the verticals.
|
| Canva is 5 times bigger if not more than Adobe Express
| which is the equivalent.
|
| Substance is miniscule in the 3d market compared to Max,
| Softimage, Maya etc.
|
| Adobe is big because of the many vertical they are in,
| not because they own them.
| fauigerzigerk wrote:
| This is a well rehearsed segmentation game that market
| leaders like to play until even the biggest companies on
| earth no longer appear to be dominant in any specific
| segment.
|
| I don't buy it. It's not just about indvidual verticals
| in their current state. For these conglomerates it's
| always about buying rising competitors out of the market
| before they can become a strategic threat.
|
| Figma could have expanded beyond any particular vertical
| they are currently in. Figma could have been bought buy a
| stronger competitor from outside the graphics space (such
| as Microsoft). Adobe didn't want to let that happen.
|
| We should block all of these defensive acquisitions. And
| we should block all acquisitions that help an already big
| conglomerate capture the next neighboring vertical
| without doing any actual engineering work (except for
| small acqui-hires perhaps)
| ThomPete wrote:
| You don't have to buy it. That's the reality. You can go
| through the numbers yourself.
|
| Adobe doesn't have network effect or anything like that.
|
| Just to give you the numbers:
|
| Adobe Creative Cloud, which includes Photoshop, has over
| 22 million subscribers.
|
| Thats 1/5 of Canva users.
|
| You guys are simply factually wrong.
| fauigerzigerk wrote:
| _> You don't have to buy it. That's the reality. [...]
| You guys are simply factually wrong._
|
| It's the argument and the conclusion that I don't buy,
| not your (and Adobe's) carefully selected set of facts.
|
| Here's a very big player in the graphics software market
| that tried to buy a potential strategic threat out of the
| market. This is the fact that matters in my view.
|
| I wouldn't let the top 5 in any market buy another
| company that is or could soon become a significant
| competitor in that or a closely related market.
| ThomPete wrote:
| Again that's not how antitrust regulation works. I am not
| sure why you keep repeating the same mistake.
|
| Figma have 3 million users. In what world would a
| purchase of them be dominating Canva with 135 million
| monthly users and with 16 million paying subscribers.
|
| You are confusing Adobe being a big company with why they
| are a big company.
| fauigerzigerk wrote:
| _> Again that's not how antitrust regulation works._
|
| Apparently anti-trust regulators disagree. They put up
| enough of a fight to at least give Adobe an excuse for
| letting the deal fall through.
|
| _> You are confusing Adobe being a big company with why
| they are a big company._
|
| I have heard your argument and I understand what you are
| saying. Unfortunately, you're not responding to my
| counter arguments, which makes this not a very
| interesting debate.
| ThomPete wrote:
| No they don't and both the US and EU had approved it. The
| UK is using a novel theory that have no basis in reality
| where they are claiming to be able to predict the future.
|
| You don't have a counter argument, you just have your own
| opinion on how it should be done. Antitrust is not being
| done that way you seem to think it's not the reason why
| the UK didn't allow it.
| Zpalmtree wrote:
| Why?
| andy_ppp wrote:
| How hard is it for Adobe to offer a competing product? It's not
| like the new features are deal breakers.
| raiyu wrote:
| Anyone else think this has nothing to do with the regulatory
| agencies but instead the market has dramatically shifted in the
| past 15 months in terms of valuations and this is a nice cover to
| cancel the deal?
|
| Figma still gets $1B "investment" without giving up any equity or
| control and Adobe gets to walk away from a massive $20B fee.
|
| Adobe makes $17B a year in revenue, they would need some pretty
| strong growth out of Figma to justify the price tag especially
| after valuations came down.
|
| But it is nice to "blame" the regulatory agencies for the breakup
| so that both companies save face.
|
| Also just seems unlikely that it was regulatory. Sure Adobe has
| the market cornered but it doesn't seem like this is where the
| agencies would suddenly choose to care so much. And if it was
| regulatory, then shouldn't those agencies come out and say "We
| blocked this, no go."
| disgruntledphd2 wrote:
| They were being investigated in the UK, the EU and the US.
|
| It seemed very unlikely (to me, at least) that all three would
| approve.
|
| That being said, if valuations hadn't changed so much then
| maybe they'd have stuck it out.
| chicken3pointer wrote:
| Nah, I think this is truly a case of regulatory agencies
| shutting the deal down. Adobe knows Figma is best-in-class in
| their category, and even in the current market downturn, $20b
| still feels like a good bet to own the winner in and up and
| coming category for the next 5-10 years
| zpeti wrote:
| I dunno, seems like there are massive risks to Figma as a
| business at this point with the developments in generative
| AI. I'm not that confident spending $17bn is justified if its
| going to take 10-20 years to make it back. Some generative AI
| startup could easily leapfrog figma.
|
| And Adobe already has its own massive trove of copyright
| images that it can use for much better generative AI.
|
| I think the last year has put adobe in a much stronger
| position and figma in a much worse position.
| rafram wrote:
| Generative AI isn't useful without a good editor for humans
| to manually tweak and integrate the AI's output, and Figma
| is essentially the only name in the game for that.
| evantbyrne wrote:
| Sketch still exists and is not only very good, but in
| many ways better.
| satvikpendem wrote:
| In what ways is it better? I've found Figma to be vastly
| superior, especially since they treat design like
| development, automating tedious processes like manually
| tweaking the layout and instead having a version of
| flexbox literally built into the design ("auto
| constraints"). They're bringing web dev and mobile dev
| ideas into design software.
| evantbyrne wrote:
| My information might be out-of-date, because I gave up on
| Figma years ago, and I recalled Sketch being
| significantly more powerful as an actual design tool. But
| now I'm looking up differences and it seems Figma has
| improved in areas it was weak in previously, like not
| having color profiles. From their feature lists they seem
| about identical.
| iAMkenough wrote:
| Who gets a better deal on compute costs, Figma or Adobe?
| If prices skyrocket, who is better prepared to pivot?
| retinaros wrote:
| you are right also with genAI trend adobe is drinking the kool-
| aid like everyone else and most likely all investment will go
| to that. to be fair they are the best company to ride this wave
| and the new photoshop features already proves that
| jibolash wrote:
| Curious why you are referring to the termination fee as an
| investment, does Adobe get anything back in return for it?
|
| Along those lines, maybe that would have been a better course
| of action in the first place, give Figma some money as an
| investor and own a piece of the upside as Figma grows, would
| probably have faced little or no regulatory resistance
| mbesto wrote:
| > Adobe makes $17B a year in revenue, they would need some
| pretty strong growth out of Figma to justify the price tag
| especially after valuations came down.
|
| That's not it works.
|
| 1. Adobe is at $19B in revenue
|
| 2. Adobe's market cap is $272B and just shy of its ATH.
|
| 3. Acquisitions, especially at this level, are usually paid
| with debt and equity, not just cash.
|
| 4. The proposed acquisition smells of both one for value (e.g.
| we buy you and we add $20B to our market cap...ok thats not
| exactly how it works, but that's the general ide) and one for
| defense (protect our existing market cap).
|
| 5. You have no idea what Figma's revenue and growth rates our
| (speculation says $400M rev). If you borrow at 10% interest to
| acquire the biz and the company is growing their profit
| annually at 20%, then Adobe can still net out in the long run.
| (again, not that simple, but illustrative is the point)
|
| Could Adobe have overpaid given the timing? Absolutely.
|
| Could Adobe have realized this and when it came time to go
| through anti-trust they just threw the b-team lawyers at it?
| Totally plausible.
|
| > And if it was regulatory, then shouldn't those agencies come
| out and say "We blocked this, no go."
|
| Not necessarily. Behind closed doors, they might have said
| "during our reviews with regulators we've been advised that the
| fight with regulators would be too risky and costly if we
| didn't succeed"
| turnsout wrote:
| There are multiple factors that could sour this deal from a
| financial standpoint. ARR multiples have been falling,
| interest rates have risen, and Adobe's performance has been
| quite strong without Figma.
|
| Meanwhile, from what I've observed, Figma is approaching 100%
| market penetration among designers, so they will need to look
| beyond their core to sell things like Figjam to "normal"
| people. With full access to financials, Adobe may have seen
| the growth curve tapering off much sooner than expected. Just
| a hunch.
| tootie wrote:
| I mean, the Fed is a kind of regulatory agency, so it's not a
| total lie :)
| lolinder wrote:
| > Sure Adobe has the market cornered but it doesn't seem like
| this is where the agencies would suddenly choose to care so
| much. And if it was regulatory, then shouldn't those agencies
| come out and say "We blocked this, no go."
|
| Both the EU and UK had already provisionally found that the
| deal was a problem, and the DoJ was expected to file suit. The
| companies had a meeting with the DoJ last Thursday [0]. They
| previously met with the EU on the 8th, and had a deadline to
| submit a settlement offer to them (not sure what that means) on
| the 21st.
|
| Maybe all of those meetings were actually going better than
| they're trying to make it sound, but the regulators certainly
| appear to have been paying very close attention to this one,
| and the timing of the deal cancellation is about right for it
| to be due to regulatory pressure.
|
| [0] https://www.politico.com/news/2023/12/15/adobe-figma-meet-
| wi...
| bbarn wrote:
| It's not completely implausible what you're getting at is
| right, even if your numbers don't quite make sense.
|
| Consider also the fact - news of this merger was almost
| universally received poorly by Figma users. The internet was
| awash with "open source equivalents" - "You don't need Figma"
| articles, etc.
| klabb3 wrote:
| I could believe this but if so why wouldn't Figma fight to get
| the deal through? $20B is a lot to leave on the table, assuming
| they'd already emotionally accepted to lose control of the
| company? Why settle for the $1B "fuck off" consolation?
| brandensilva wrote:
| What would you want Figma to do that Adobe cannot do itself?
|
| In the end 3 probes is way too much legal tape for even Adobe
| to step into hence the abandoned deal being cheaper in the
| long run than fighting to acquire Figma.
| cj wrote:
| This sounds on point.
|
| In the small startup M&A market, maybe 50% of deals are falling
| through? Of the 50% that don't fall through, the vast majority
| are closing only after being renegotiated in the last hour,
| e.g. buyers promising to pay $x, but in the last hour the buyer
| changes their offer to $x/2.(These are deals with zero
| regulatory review)
|
| Most common issues is buyers backing out because they couldn't
| secure the debt to finance the deal like they expected they
| could, multiples decreasing in the market, investor sentiment
| shifting away from riskier tech ventures, etc.
|
| If those trends in small company M&A also apply to large
| company M&A, the parent's hypothesis is very valid.
| finnh wrote:
| Where are you getting those numbers from? The valuations of
| small acquisitions are closely held information; afaik there
| is no place to just look this stuff up.
| cj wrote:
| 1st hand info / network. I'm a CEO. YC Founder and
| Techstars founder. My CFO is a fractional CFO that works
| with other startups clients, same stories.
|
| This kind of information and what really goes on behind the
| scenes is rarely revealed. Mainly because if I told you
| about the shitstorm story of a top tier VC trying to buy my
| company and the deal exploding, that VC will do everything
| in their power to bury the story and make sure I'm
| personally not able to operate in the industry in the
| future.
|
| The people at the top of tech are cut throat individuals.
| (And the people at the "top of tech" are not CEOs...
| they're the investors. The people who sit on boards who you
| never hear about. And that's the way they like it)
| finnh wrote:
| Thanks. I've sold two companies, and gotten a pressurized
| squeeze from a major player (which we said no to - we
| were profitable so didn't have runway problems), but I've
| never heard of dropping an offer valuation at the last
| minute.
|
| Nasty business!
| cj wrote:
| I can give you one worse: a board member (and deal lead,
| from <redacted> Ventures) telling me there are only 3
| people on the board.
|
| 3 months later a month before the deal is supposed to
| close, 2 more board members come out of the woodwork and
| shut the deal down. No idea they were on the board. Was
| outright lied to. (I have the call recordings to back
| that up)
|
| Mind you these are top tier brand-name VCs. They hide
| behind their reputation, and it works because people like
| me are extremely hesitant to write comments like this
| calling out specific firms and people.
| finnh wrote:
| ugh sorry to hear that. That squeeze I mentioned before
| (lowball offer at "this is what it will cost us to copy
| you") was, thankfully, for a company that we bootstrapped
| so we had no VC pushing us to close. And we bootstrapped
| because of my experience at my previous, VC-backed
| company.
| huevosabio wrote:
| Regulation doesn't have to say "no" to suppress activity, it
| can also make it painfully long.
| boeingUH60 wrote:
| Imagine being Dylan Field staring at a $1 billion+ payday, and
| the government tells you that ain't happening, lol
| andsoitis wrote:
| Why did Figma want to sell itself to Adobe in the first place?
|
| Even though their revenue is only about $400MM, As far as I know,
| they make a very healthy profit (operating margin of ~90%), and
| they've also been expanding through organic and acquisition means
| (e.g. they bought Diagram).
|
| Is it because they see the ability to grow the company's products
| even more given the Adobe footprint?
| fnikacevic wrote:
| The $20B price was a massive overpay is the most likely reason.
| paulpan wrote:
| This exactly. When someone offers you $20B, it's hard to turn
| it down. In Adobe's case, $20B is a bargain price to stifle a
| competitor.
|
| Even if Figma founders didn't want to sell, all the VCs and
| other investors would force the hand.
| fnbr wrote:
| Assuming your numbers are correct, they sold for 50x ARR, which
| is a very very good price. I bet that's why. It's hard to do
| better than that.
| cartermatic wrote:
| I think they saw 20 billion reasons to sell to Adobe. Their
| last valuation was $10billion in 2021 so a 2x on that a year
| later would be hard for anyone to pass up. They can pretend
| they went with Adobe for aspirational aims to make the product
| better, but at the end of the day it was about the very juicy
| multiple Adobe was offering.
| eklitzke wrote:
| What makes you think they have an operating margin of 90%? The
| blog post says in the last 15 months alone they've hired 500
| additional employees ("figmates"), there's no way their margin
| is anywhere close to what you cite.
| popcalc wrote:
| "Figmates" has a dotcom air to it.
| ProbablyRyaan wrote:
| Wonderful news. Adobe was bound to ruin this product, whether on
| purpose or not. This is a win for the consumers (for once).
| preommr wrote:
| What a disaster for Adobe.
|
| They signal they can't build something to outcompete Figma. Their
| stock price falls
|
| They axe their existing competing product, and is therefore now
| way behind.
|
| They face problems with the acquisition, which makes their stock
| price fall again because it signals that not only can they not
| build products they can't use their money to buy companies that
| do.
|
| Then it's confirmed they can't acquire Figma.
|
| Then they have to lose 1bn dollars.
|
| And that money is going to a competitor that they took seriously
| enough to try and acquire at a sky-high price.
|
| QQ
| blagie wrote:
| I don't think that's a correct analysis.
|
| Adobe is very good at building software. It's not the problem.
| It's not that Adobe can't compete with Figma. It's that they
| don't want to.
|
| Adobe has a great engineering team and ships wonderful
| products. The problem with Adobe is that the business side is
| anticompetitive, exploitative, and sleazy. Buying Figma, they
| lose a competitor. Competitors have a nasty tendency to expand
| to adjacent markets, and that's the sort of thing Adobe likes
| to nip as early as possible.
|
| If not for their business practices, I would totally buy Adobe
| products, because they're great.
|
| As is, I don't know if Adobe won't triple prices tomorrow for
| me to continue to be able to edit my own documents (once they
| know I'm locked in), or find some other way to !@#$ me up the
| !@#$. The slight hit to product quality going to competing
| products and open-source is more than made up for with the
| stability of having a reliable business partner, or source code
| I can build myself, respectively.
| 542458 wrote:
| > Adobe is very good at building software.
|
| Is that actually true? XD attempted to directly compete with
| Sketch and Figma, and was not generally considered to be a
| success at that primarily because they couldn't ship features
| fast enough to catch up.
| jyunwai wrote:
| At the same time, however, Adobe maintains products with no
| clear competitors due to their quality. This is especially
| true for After Effects (for motion graphics in videos).
| martin_a wrote:
| > This is especially true for After Effects
|
| Or Illustrator, Photoshop, InDesign, Acrobat...
|
| I know, Affinity exists but as everybody in the graphic
| industry has learned on Adobe software, switching over is
| hard.
| dclowd9901 wrote:
| > At the same time, however, Adobe maintains products
| with no clear competitors due to their quality. This is
| especially true for After Effects (for motion graphics in
| videos).
|
| Really not sure if this is true. Probably due more to
| "network effects". It's hard to compete with Photoshop or
| Illustrator if everyone is familiar with their UIs and
| has all their files as PSDs or Illustrator files. Also
| anyone who would be reasonably close to creating a good
| competitor would be bought.
| prismatix wrote:
| Take a look at their _five_ other industry-leading
| products. UX design was never their forte, but they have
| the rest of the design world in the bag.
|
| As a former designer, I can tell you from experience that
| the designers I encountered would much rather have the
| newest tools at their hand for a subscription fee than be
| behind in software. There's so much the competitors
| _cannot_ do (or can 't do _well_ ), and if your prodcut
| doesn't work on a subscription model you're never going to
| be giving the latest features away in updates.
| alephnan wrote:
| Photoshop is one of the best pieces of software, period.
|
| Premier is, well, the premier photo editing app.
|
| Every designer knows illustrator. UX/UI is just a subset of
| design.
|
| Many web developers who were around before the HTML5 era
| will swear by Dreamweaver.
| blagie wrote:
| > Photoshop is one of the best pieces of software,
| period.
|
| FWIW, painting is one of the easiest pieces of software
| to get right. As much as I couldn't replicate the volume
| of stuff Adobe has done in 30+ years, I could build the
| bones of Photoshop in a few months, with modular
| extensibility frameworks to slot everything else in.
|
| Indeed, GIMP did much the same thing. They messed up a
| few things (like color models), which continue to haunt
| it (even the ones which were retroactively fit back in),
| but it's not any more work to do it right. If they had,
| it'd be very competitive with Photoshop today.
|
| The basic data model is a grid of pixels, organized with
| layers, and having masks, and an extensible set of tools
| to operate on them. You also need a little bit of "other"
| for things like editable text, before it is flattened
| into the above. Add modular tools and filters, and you're
| 90% of the way there.
|
| Most of the value-add of Photoshop is simply developer
| time to add a comprehensive set of tools. Adobe can hire
| a researcher to tweak some algorithm for years, and at
| this point they've got a lot.
|
| Basic video editing is similar. Linear streams, in
| layers, with modular filters and effects.
|
| I'm much more impressed with Adobe drawing tools, page
| layout, and animation. That's HARD because there aren't
| the same kinds of clean data models and abstractions.
| These are harder to use, and don't feel as polished, but
| that's not because they're less well-written, but because
| they solve a harder problem. I could NOT build the core
| of that myself in a reasonable amount of time.
| doctorpangloss wrote:
| They didn't just pay $20b for something that's probably worth
| $500m so I think they won this round.
| strix_varius wrote:
| Figma had revenue about in line with Heroku, with a similar
| growth curve. However, Figma has an even more difficult
| expansion story than Heroku because it's already near 100%
| market penetration for its core market.
|
| Salesforce bought Heroku for $212 million. By avoiding spending
| $20 billion for a similar company, in my estimation Adobe has
| finally come to its senses.
|
| This really seems like an executive wanted to make an
| unrealistic long bet a couple of years ago, and since then
| Adobe has seen Figma's financials and cooler heads prevailed.
| pier25 wrote:
| This is good news for Figma. They make amazing products and the
| last thing they need is the Adobe enshitification.
|
| Adobe needs to get their shit together. 15 years ago they were
| universally loved and now everyone hates them. Their software is
| super bloated and Creative Cloud runs so much crap in the
| background even when you're not running any Adobe app and even
| when you've disabled its background apps in macOS.
| Stokley wrote:
| completely unexpected. wonder what this means for the long-term
| future of Adobe. I only see Figma growing in importance from here
| izolate wrote:
| That's assuming the company still has motivation to continue
| and improve. I can only imagine there's a lingering feeling of
| dejection at Figma right now.
| petercooper wrote:
| If countries want to heavily regulate business deals, I think the
| quid pro quo should be a tax system that provides a good way for
| founders and early employees to take some money off the table
| _without_ having to sell to big companies like Adobe, by going
| public, or having half of any gain wiped out in taxes. Why
| shouldn 't those folks able to pick up a lump sum for their work
| and the risk they took? They may as well have got a job at a big
| enterprise if an annual paycheck was all that mattered, and then
| you end up with fewer new companies and entrepreneurial risk-
| taking.
| arrosenberg wrote:
| Go public? Why shouldn't you have to pay taxes on it? Are you
| going to stop using the roads when you are rich?
| petercooper wrote:
| Not _no_ taxes, just something that maintains a good reward
| /risk balance and an invcentive for people to be founders or
| early employees of these types of companies. The UK used to
| have so-called Entrepreneur's Relief, for example. Some
| countries have low capital gains tax regimes. It's not an
| uncommon thing.
|
| (Sure, a country _could_ gleefully milk everyone to the max,
| but then they can 't complain when they lack for
| entrepreneurship.)
| arrosenberg wrote:
| It just makes no sense and has never been necessary to
| incentivize Americans to take business risk. I don't
| understand why the entrepreneur, who is presumably getting
| a big exit in this scenario, deserves additional tax relief
| on top of that windfall. That sounds like another way for
| the rich to get even richer.
| pcurve wrote:
| I wonder if Figma is cashflow positive. They must've hired an
| army of people over the past 18 months. The $1billion cash
| infusion will help for sure.
| Zetobal wrote:
| I am curious if XD will still stay EoL or if they write a blog
| post about it's bright future in 1-2 days.
| kibwen wrote:
| Every time a merger fails, an angel gets its wings.
|
| Force megacorps to actually compete rather than just snapping up
| their potential competitors.
|
| Force startups to aspire to create an actual product rather than
| just manipulating the lizard-brain fears of irrational megacorp
| execs in the hopes of a payout.
| samhuk wrote:
| > Force startups to aspire to create an actual product rather
|
| I'm getting on to 10 years in the software industry as an
| engineer at the moment and in my view this is one of its most
| disappointing and frustrating aspects.
|
| The whole software start-up scene just feels saturated with
| FIRE-obsessed individuals who prefer just about anything
| (money, vacation, travel, fame, ...) over company, product,
| real building, craftsmanship, etc.
|
| I legitimately hear phrases like "5th time's the charm for an
| exit and payout!" way too often. It frequently just exacerbates
| the consolidation of technology, knowledge, wealth, and often
| hurts innovation, let alone can result in the solid team(s) of
| engineers left out to dry (although some can be also gunning
| for the payout in the end too).
|
| In my view, there are just too many sell-outs pawning off solid
| products and teams to the highest bidder. I wish it wasn't that
| way.
| yellow_postit wrote:
| Wonder how this shifts funding. VCs won't get same
| returns/horizons if companies can't aim for acquisition exits.
| paxys wrote:
| Best outcome for consumers. I really hope the experience was
| expensive enough for Adobe (due diligence, lawyer fees,
| "lobbying" 3-4 different governments, $1B break-up fee) that the
| entire big tech M&A market takes a hit.
| wg0 wrote:
| Yeah that's sad because couldn't pull a VMWare onto unsuspecting
| UX desgin community I suppose.
|
| What's wrong with staying a small profitable company that loves
| what it builds and cares for its customers?
| eddiewithzato wrote:
| difference between giving the early employees a lamborghini vs
| a yacht
| JadoJodo wrote:
| While I do see this as great news (for all the reasons others
| have outlined), I wonder how this will impact VC in the future;
| If the current goal is for companies to get VC money, burn that
| cash for years and years and years, and then have a huge IPO or
| acquisition (that makes it all worth it), it would seem
| regulatory issues would start to scare away investment.
| willsmith72 wrote:
| If they just wanted to cash out, they could still IPO or be
| acquired by almost literally any other company in the country.
| Adobe might be the only one who cause regulatory issues.
|
| I'd rather have "regulatory issues" in a case like this even if
| it does slow down VC money
| cartermatic wrote:
| I think the door is still open for Microsoft, Google, Apple or
| Salesforce to make a play. Figma was rumored to have approached
| Microsoft during their talks with Adobe but Microsoft declined
| to put in an offer as they were working through the Activision
| Blizzard acquisition at the time. Either one could probably get
| a "deal" at a $10-$15b valuation.
| yellow_postit wrote:
| I'd hope this somehow influences regulators too. 15+ months of
| uncertainty and it's the tiny UK market that tanks things. The
| lack of regulatory certainty will push for more lobbying and
| influence peddling which I think is net worse for the global
| industry.
| blackenedgem wrote:
| It's not really the UK regulator's fault though, if anything
| they were the best as they gave their response first (a
| provisional no). The EU was still investigating and the US
| DOJ was also preparing similar investigations. The CMA also
| provided Adobe with a list of changes they could make in
| order for the application to be approved, so it's not even
| like they were unwilling to entertain it.
|
| As we saw with the Blizzard acquisition the UK CMA will bend
| to international pressure if it's the only one holding out.
| Anon826 wrote:
| > the Blizzard acquisition the UK CMA will bend to
| international pressure if it's the only one holding out.
|
| I read that MS agreed to remedial changes for the purchase
| to be approved by CMA, but those changes were the same ones
| that CMA originally asked for at the start that MS refused.
| So CMA got what it wanted but it's still seen as a MS as
| eventual winner and CMA loser.
| MetaWhirledPeas wrote:
| > it would seem regulatory issues would start to scare away
| investment
|
| In certain narrow cases maybe, where you really want the
| monopoly-holder to buy the startup. But overall this is better
| for VCs because competition breeds both investment and
| acquisition opportunities. In most cases 3 big competitors
| seeking to acquire your startup is better than 1 big monopoly
| seeking to acquire your startup.
| Levitz wrote:
| >it would seem regulatory issues would start to scare away
| investment.
|
| Or maybe the goal ought to change.
|
| Maybe everything getting acquired by a huge corporation is not
| a good thing.
| Solvency wrote:
| I wonder how Autodesk has been able to essentially acquire
| everything Adobe hasn't virtually unchecked for decades
| though.
| ajkjk wrote:
| Yeah, can't wait.
| lmeyerov wrote:
| A couple agencies having certainly been flexing like that
|
| The chilling effect may be more around the design tools market
| specifically
|
| The case of Adobe is a bit different than anti-monopoly
| movements against other $T because the lack of 'serious' $100B+
| market cap competitors here. So while say an adtech can have
| multiple big buyers in the $100B+ club, it's unlikely to see
| Autodesk, Corel, Canva, etc to do a $20B purchase here. AFAICT
| only Microsoft would sensibly be able to put its hat in the
| ring at high levels, made even more sane b/c the GitHub
| purchase, but even that was at $7.5B. So if there is no such
| thing as a decacorn in design tools b/c Adobe can't do big M&A,
| then VCs are only looking at exits at $1B, and funding +
| valuations get less frothy vs other markets.
|
| All that starts mattering around Series A or Series B stage, as
| they look at how much $ they can exit at, and how big of a
| follow-on round the company can get with the same constraints.
| If a VC has a fund of > $50M, a pitch that cannot exit at above
| $B may break their portfolio design.
| rurp wrote:
| I think the main effect will be to push VC funded companies
| more towards sustainable growth, with less emphasis on growth
| at all costs. This strikes me as a good thing overall. That
| probably won't harm the fundraising prospects for solid
| businesses much if at all.
|
| Highly speculative or hyped companies will probably have a
| somewhat more difficult time attracting VC investors, but so
| many of those turn out to be frauds or vaporware that I'm not
| too concerned. Companies like the ones that benefitted from the
| SPAC boom a couple years ago. Most of those ended up being
| highly overvalued companies that lost money for the post-VC
| investors.
| thenickevans wrote:
| Eh, this is probably true. It was fun in the days when it was
| all about getting acquired by Google or Facebook, but I guess
| this spurred a lot of unsustainable businesses. If you were
| making revenue you were seen as dumb. "Lol, why would you
| charge money? Doesn't you know how to build a business?"
| dopeboy wrote:
| Definitely disappointing. Only hope is they IPO.
| thenickevans wrote:
| 100% agree. I thought similarly with Plaid and Visa. It feels
| like it will stifle competition because it's now harder to get
| funding. Back when Facebook and Google were making so many
| acquisitions, it seemed like money was just flowing. Bad for
| competition. Good for incumbents.
| noahhh wrote:
| "The companies have signed a termination agreement that resolves
| all outstanding matters from the transaction, including Adobe
| paying Figma the previously agreed upon termination fee." -
| that's from the announcement on the Adobe blog. Does that mean
| that they do not have to pay the $1bn break-up fee to Figma now?
| hmage wrote:
| That's great news.
|
| I wish someone would undo Adobe's Allegorithmic buyout, they lost
| all their ambition after buyout.
| asylteltine wrote:
| Good! This would have created yet another monopoly and adobe
| would have ruined the company
| fsloth wrote:
| Can someone tldr why Figma is so important? I'm not familiar with
| their offering.
| karaterobot wrote:
| On the one hand, as a designer who uses Figma every day, this is
| great news. On the other hand, the fact that Dylan Field was
| willing to do it in the first place felt like a bit of a heel
| turn. Yeah, it's a lot of money, I know. Maybe I'm alone in this,
| but I've already shifted my expectations for the long term
| direction of the product from "they can do no wrong" to "when is
| the other shoe going to drop?"
| hipadev23 wrote:
| A CEO also owes it to their employees and investors to let
| everyone have a massive payday.
| deweywsu wrote:
| I think this is at the core of the rot of American society.
| The thinking that a CEO "owes" the marketing of their company
| so as to cash it in or even turn profits is, in my opinion,
| is a mark of the biggest moral ineptitude of the western
| world's thinking. Yes, I realize this is the 'norm', but it
| clashes with deep values of the people who aren't
| shareholders, but are no doubt vested in the product the
| company produces, mainly the customers. It ignores their
| needs completely because they don't own stock. "We sold the
| company, and the new owners bastardized it by slapping their
| logo on it by eliminating the free tier" is almost
| commonplace now in business dogma, and yes, most people think
| it is the kind of strategy 'owed' to shareholders, but this
| one-sided thinking ignores the better interest of users who
| the company has built their business on the backs of, and who
| will now be bait-and-switched into a subscription model,
| never mind the needs that drove them to the product in the
| first place. Yes, this is how capitalism works. What I'm
| saying is that capitalism, as a model, is flawed from a
| moralistically balanced point of view. It's a never-ending
| race to the bottom by optimizing for greed until every drop
| of monetization is squeezed out and every person is left
| without. Should the owner's employees make money, I mean
| after all they do the work? Yes, but who takes into account
| the inestimable value added by the initial users who's
| interaction with the product shaped it into what it is today?
| jzl wrote:
| Here here. One word, nay, one letter in response:
|
| X
| jamiequint wrote:
| "it clashes with deep values of the people who aren't
| shareholders, but are no doubt vested in the product the
| company produces, mainly the customers. It ignores their
| needs completely because they don't own stock."
|
| Presumably companies generate value for shareholders by
| selling things to customers and generating profits, which
| makes customers the ultimate beneficiaries. What companies
| are you thinking of that ignores their customers' needs
| completely and are still quite successful and valuable for
| shareholders?
| marssaxman wrote:
| Do you actually believe that, or are you mocking a bit of
| startup-culture hubris?
| jdgoesmarching wrote:
| I'm about as anti-consolidation as someone can be, but I'm
| not about to blame a CEO for selling when you're offered a
| price way above any realistic valuation. I put this at the
| feet of Adobe and regulators, not the guy taking the
| biggest payday opportunity possible for his employees and
| shareholders.
| hipadev23 wrote:
| I absolutely believe it when the vast majority of the
| employees for the company in question were compensated with
| stock options.
| vitaflo wrote:
| This is the risk you take when you choose options over
| cash.
| Applejinx wrote:
| No, their investors.
|
| Employees don't automatically have the same motivations as
| the investors.
|
| If you want an employee with exactly the same motivation as
| an investor, hire an embezzler.
| coldpie wrote:
| > when is the other shoe going to drop?
|
| Keep an eye out for the IPO, that'll be their next chance to
| sell out their customers.
| ramijames wrote:
| I can not describe how happy this makes me. Fuck Adobe. I will
| never forgive them for buying and killing Macromedia.
| poisonborz wrote:
| Yes, but they will probably just sell to number 2 on the buyer
| list, who may not be much better than Adobe.
| ramijames wrote:
| Have to be positive. Just about any company is better than
| Adobe.
| sgammon wrote:
| macromedia was amazing and this is such a real comment
| ricardonunez wrote:
| Until Afinity came out with their products I was still
| missing fireworks.
| josefrichter wrote:
| Best news ever. I don't know anyone in design community who was
| happy about this.
| eurekin wrote:
| Adobe acts like a proper "wealth manager" and not a creative
| company - good for Figma!
| echelon wrote:
| Or they could see the competitive landscape for creativity
| changing fast and view that Figma's product is an evolutionary
| dead end.
|
| They might see a Gen AI approach to Figma that will kill Figma
| in 5 years.
| eurekin wrote:
| Well, they could use the figma to actually develop that AI;
| users, documents and etc.
| FredPret wrote:
| Photographers: is Adobe Photoshop still the king of photo
| editing?
|
| I strongly dislike Adobe's "subscription only" business model,
| but it seems the market is telling them that subscriptions are
| a-OK: Adobe's profits are very steady and are up 70+% in five
| years. [https://valustox.com/ADBE]
| bastawhiz wrote:
| I'm not a photographer, but pretty much everyone I know who
| does anything with photos or image manipulation is using
| Photoshop. I'm the only person I know who uses a Photoshop
| alternative in any capacity (pixelmator)
| threetonesun wrote:
| The Affinity suite of products is pretty popular, at least
| what I've seen from non-professional use. Not sure what their
| professional use numbers look like, but for at least
| Photoshop/Illustrator/Publisher they seem like a real
| competitor.
| phlsa wrote:
| I feel like there are actually more great options out there
| today than back in the pre-subscription days of Adobe. It all
| depends on what parts of Photoshop you're actually using, but
| between Affinity Photo, Pixelmator, Capture One and many
| others, there's a good chance that you can find something for
| your needs.
| capableweb wrote:
| Depends on what kind of editing is needed. Most professional
| photographers I encounter use Lightroom, but they don't do any
| heavy editing like cutting out/in actual objects, but just
| modify color curves and whatnot.
|
| Besides, Photoshop really isn't a competitor in any way to
| Figma, they have two very different use cases. Closest
| competitor would be Adobe Illustrator.
| pier25 wrote:
| For photo editing, PixelMator Pro and Affinity Photo are great.
| FredPret wrote:
| I'll check these out. Both have one-time payments through the
| App Store, which is about 1000x better than an opaque,
| eternal, very expensive subscription with Adobe.
|
| I'm a very non-serious amateur; all I do is edit the light
| curves in my photos or do some light cropping. The built-in
| editor in Apple Finder is amazing for that!
| pier25 wrote:
| I think the latest version of Affinity is not available
| through the AppStore though.
|
| https://affinity.serif.com/
| ulyssesgrant wrote:
| I like Capture One as an alternative to lightroom for a
| fujifilm camera, it has great integrations with the camera's
| film styles feature. It doesn't offer the more powerful image
| manipulation features of photoshop though. It can be one-time
| purchased for the yearly release or subscribed for continual
| updates
| jacknews wrote:
| Good news. I guess there are some valid (societaly desirable)
| reasons for companies to buy other companies, but this doesn't
| seem to be one.
|
| Now, I want to read that Microsoft is abandoning the
| Activision/Blizzard acquisition, a similarly anti-competition
| deal.
| frankchn wrote:
| The Microsoft/Activision-Blizzard acquisition had already
| closed in October.
| aleph_minus_one wrote:
| A consideration: could these regulatory issues not rather be some
| welcome pretense for Adobe to cancel the merger since Adobe by
| now realized that they would overpay for Figma?
| stainablesteel wrote:
| regulators in the eu and us didn't seem to mind this, a few
| select regulators in the uk for some reason seemed to care off of
| some strange speculation.
|
| this seems like a really bad thing that it was held up for so
| long and without any good reasoning. nightmare scenarios both in
| and coming out of the uk right now
| CodeNest wrote:
| Bad news for Figma. I am hundred percent sure that Adobe's
| alternative product will dominate the entire design market.
| tristan957 wrote:
| Adobe discontinued their product. What do you mean?
| brandensilva wrote:
| Adobe XD never gained adoption so I don't see that happening
| with this failed deal so you will be 100% wrong.
|
| Where Adobe will likely win out though is in the AI side of
| things so time will tell if that would be enough to replace
| Figma alone.
| anonu wrote:
| The UK regulator blew this deal up. Founders should think twice
| about doing business in the UK.
| tristan957 wrote:
| The DOJ was surely going to sue, and most likely win. Adobe
| killed their own worse product to buy a competitor. Seems like
| an open and shut case.
|
| Your analysis seems extremely short-sighted.
| C0mm0nS3ns3 wrote:
| So you're saying if you try to build a product, fail and want
| to acquire that product from another company - now that you
| have 0 competition with that product - that should somehow be
| illegal? Why exactly?
|
| Also what product did Adobe had that was in direct
| competition with Figma?
| siliconwrath wrote:
| Adobe XD: https://en.wikipedia.org/wiki/Adobe_XD
| Narretz wrote:
| Adobe XD was a Figma competitor. However, Adobe stopped
| development after they announced the Figma merger, and you
| can still use it today.
| fairity wrote:
| > Fifteen months into the regulatory review process, Figma and
| Adobe no longer see a path toward regulatory approval
|
| How in the world did it take fifteen months for regulators to
| reject this? That's an absurdly long time to be operating a
| business in limbo, and I have to assume it's the regulators
| dragging their feet since the companies have every incentive to
| move quickly.
|
| I don't have an opinion on whether or not the merger should be
| approved, but regulators need to make up their minds quicker or
| else you can expect a serious chilling effect on M&A. Can you
| imagine agreeing to get acquired knowing that it can take up to 2
| years to close? Anyone operating a real business would be crazy
| to sign on for the distraction.
| pas wrote:
| we have no idea when they filed what papers where ... and when
| regulators answered and what, and then how the companies
| reacted, and when, and ...
|
| on the announcement, Sep 15, Adobe stock fell by 17%. the FTC
| opened some investigation on Nov 2. some EU thing started its
| process in February (based on filings by refering countries,
| and of course we have no idea of the details of those country-
| level processes)
|
| so, all in all, it's likely that relevant authorities quite
| soon signaled that Adobe-Figma is facing an uphill battle, and
| now, as they announced, they backed down.
|
| we have no idea of the negotiations, who was fast or not, who
| recommended what, asked for what guarantees, and so on.
| kmlx wrote:
| > we have no idea when they filed what papers where ... and
| when regulators answered and what, and then how the companies
| reacted, and when, and ...
|
| detailed timeline, explanations, submissions etc here from
| UK's CMA:
|
| https://www.gov.uk/cma-cases/adobe-slash-figma-merger-
| inquir...
| pas wrote:
| thanks! very interesting. how do these big M&As work? was
| Adobe-Figma supposed to file some request? (but that would
| be on the timeline I suppose.)
| lancesells wrote:
| I'm going to guess regulators are plenty busy with a long list
| of things to do. When the acquisition gets announced it gets
| added to the list and they make their way to it.
|
| I really doubt regulators are dragging their feet. They are
| most likely understaffed and overworked. Things this big should
| take time for all sides.
| remus wrote:
| > How in the world did it take fifteen months for regulators to
| reject this?
|
| Presumably regulators in a few countries were interested, each
| with their own processes, and presumably there's some fairly
| significant back and forth between the regulators and
| adobe/figma as adobe/figma tried to convince the regulators
| that the deal should go ahead.
|
| 15 months seems very believable for a deal of this size.
| lazide wrote:
| Seems like regulators didn't reject it, but tarpitted it?
|
| And with market conditions having changed so much in 15 months,
| this could just as easily be buyer/sellers remorse before the
| deal actually closes. For a 15+ month closing, it wouldn't be
| the first time!
|
| Actually completing mergers/buyouts takes years anyway.
| woobar wrote:
| It is not a simple yes/no response from the regulators. First,
| they will request additional information. That will take some
| time to prepare. Then they would offer some changes to the
| proposal. I.e. we cannot approve this deal until some
| additional requirements are met. Then parties involved evaluate
| these requirements and counter. At some point business will
| decide that there are too many constraints and abandon the
| deal.
| Bjorkbat wrote:
| I would argue that the regulators made their point pretty clear
| early on when the DOJ opened a lawsuit against Adobe. The
| people most responsible for keeping this in limbo were Adobe's
| lawyers.
| technofiend wrote:
| "It is difficult to get a man to understand something, when
| his salary depends upon his not understanding it!" - Upton
| Sinclair
| ajmurmann wrote:
| The Broadcom & VMware merger took similarly long and was
| approved. The duration is completely unacceptable and poison
| to business. I'm general against mergers and think it's
| better for consumers and the market if competitors fight to
| the (metaphorical) death instead, but if we do something,
| let's do it smoothly and right.
|
| That said, for mergers like that a ton of countries are
| involved which makes things even more complicated and makes
| it harder to point out where we need to make things smoother.
| ethbr1 wrote:
| This would have gone quickly, to no, if Figma and Adobe had
| taken the first answer they got from DoJ at face value.
| russell_h wrote:
| I don't know anything about the Adobe / Figma situation,
| but "If you just don't question the government they won't
| make your life so hard" doesn't seem like a very strong
| response to accusations of overreach.
| ethbr1 wrote:
| By all means question the government! And take them to
| court!
|
| Just don't disagree with them and engage lawyers AND then
| complain about how long "the process" is taking.
| JumpCrisscross wrote:
| > _Broadcom & VMware merger took similarly long and was
| approved. The duration is completely unacceptable and
| poison to business_
|
| The number of such mergers, globally every year, is
| countable on two hands. They involve the wealth of nations
| (this one's similar to Malta's GDP [1][2]).
|
| It would be unreasonable to permanently staff the
| regulatory force that would be required to quickly review
| such deals in any industry.
|
| [1] https://en.wikipedia.org/wiki/List_of_countries_by_GDP_
| (nomi...
|
| [2] https://news.adobe.com/news/news-details/2022/Adobe-to-
| Acqui...
| depr wrote:
| >They involve the wealth of nations
|
| Do they though? People often compare rich people or
| companies to a country GDP's, but GDP is based on a
| single year. The size of a company's bank account is not.
| A year is pretty arbitrary. In some sense it's like
| saying the distance between New York and Washington is
| 200 miles which is not that long, because a Ferrari's top
| speed is 200 mph.
| JumpCrisscross wrote:
| > _it 's like saying the distance between New York and
| Washington is 200 miles which is not that long, because a
| Ferrari's top speed is 200 mph_
|
| It's saying the distance is within a class negotiable by
| a Ferrari.
|
| In the GDP to value case, we're saying that the
| consideration at hand is comparable to all of the work of
| a small country for a year. So the care the latter gets
| is in the same class as the care the former should
| receive.
| Dylan16807 wrote:
| I don't understand. If there are several per year, and
| they're going to take a couple months even at maximum
| speed, then permanently staffing the regulatory force
| sounds very reasonable to me! (For the US and EU which
| are going to weigh in on a big fraction.)
|
| Why would you want to be hiring and firing constantly?
| smachiz wrote:
| There are permanent staff. The issue of time isn't any
| individual regulator - it's that there's regulators in
| every country they operate in. And the company is
| negotiating with them all simultaneously - figuring out
| what would make the EU say yes, and then taking that to
| the US and see if that will let them say yes, then going
| to Japan and making sure they'll say yes, then going to
| India - and you don't want some of them knowing that
| everyone else has already said yes, because then they'll
| hold out to get some last special thing.
|
| These are complicated negotiations, in many complicated
| jurisdictions.
|
| How quick do you think they should be? For everyone to
| understand the potential ramifications and consult
| appropriate industry experts? Let competitors et al file
| briefs?
| Dylan16807 wrote:
| Once they get working on it, I would think they could get
| consultation and competitor briefs back within a month.
| Then have an initial answer within two months of the
| announcement, and if that answer is a "no" they'd have a
| good idea of what would need to be changed.
|
| And I don't see a great reason that negotiations should
| more than triple that amount of time. If they're not
| budging, make the "no" final. So two months initial, six
| months max, would be good numbers.
|
| If the company wants to negotiate with everyone in
| serial... that's their problem.
|
| > and you don't want some of them knowing that everyone
| else has already said yes, because then they'll hold out
| to get some last special thing
|
| Wasn't the thesis of this comment line that government
| regulators are being slow or being a problem? This
| supports that idea, I think.
| JumpCrisscross wrote:
| > _If they 're not budging, make the "no" final. So two
| months initial, six months max, would be good numbers_
|
| Have you been proximate to a merger?
| JumpCrisscross wrote:
| > _permanently staffing the regulatory force sounds very
| reasonable_
|
| There _are_ permanent staff. There are also legions of
| industry experts contracted on a case by case basis. Full
| staff on standby would mean having, on retainer, experts
| in every industry where a merger might happen.
| consumer451 wrote:
| Or, maybe we could make attempts to regulate our market
| economy in order to prevent monopolies, and thereby
| encouraging competition. (aka, disruption)
|
| I didn't truly process the damage that monopolies can do
| until I heard this podcast with Sean Carroll and Cory
| Doctorow.
|
| There is a full transcript at this link if you prefer to
| read the conversation.
|
| https://www.preposterousuniverse.com/podcast/2019/10/21/69-
| c...
| ajmurmann wrote:
| As I said, I'm quite happy with that, but if we do
| something, let's do it right and not half-assed.
| consumer451 wrote:
| I agree there. We seem to be recovering from a cycle of
| not caring about monopolies at all, and corporations are
| now as strong as they were in the late 19th century. I am
| not surprised that anti-trust is slow and unpredictable
| today. I hope that we settle into a more predictable
| regime, no matter which political party is in power.
|
| For historical references, anti-trust filings began
| against Standard Oil in 1906, and it was broken up in
| 1911. [0]
|
| The AT&T breakup took four years, from 1978 to 1982. [1]
|
| [0] https://en.wikipedia.org/wiki/Standard_Oil
|
| [1] https://en.wikipedia.org/wiki/United_States_v._AT%26T
| jzb wrote:
| When the powers that be decide to block a merger, they
| have to make the case. There's looking at the proposed
| merger and being able to say "this is bad and may be
| antitrust," and then there's actually _making the case_
| when it comes down to it. That takes time. And you can
| expect companies like Adobe to fight rather than just
| saying "oh, you don't like this? OK. We'll withdraw."
|
| The DOJ and other bodies voiced opposition early on. They
| signaled quickly that they were not in favor of this. The
| interim between those actions and today were the
| regulatory bodies actively making cases against it and/or
| negotiating with Adobe & Figma how they could proceed in
| a way that the regulatory bodies would want to approve of
| the deal.
|
| The whole idea that this was "half-assed" in some way is
| misguided.
|
| Note that I worked for Red Hat while IBM was acquiring
| it. It took from (IIRC) October 2018 to July 2019 without
| strong opposition. When you're talking about companies
| that have that much impact on a market, it takes a while.
|
| And it should -- the larger market doesn't benefit from
| waking up to find out that a major software supplier has
| been gobbled up overnight. You can see the pain that
| VMware employees + customers are going through right now
| and they've had a lot of time to process the idea.
| 0xbadcafebee wrote:
| > it's better for consumers and the market if competitors
| fight to the (metaphorical) death instead
|
| I never understand why this is the only other option. If
| you're in a town and open a coffee shop, and someone else
| opens a coffee shop, if the town is big enough, you can
| both thrive. You don't have to try to take out the
| competition. But every big corporation decides it's the
| only option.
| ajmurmann wrote:
| Because if you are the only one selling coffee, you can
| jack up the prices and keep the returns growing as they
| are required to.
| jn1234 wrote:
| That deal had more to do with national security concerns
| being addressed and Broadcom's shitty business strategy
| rather than market share concerns.
| vpribish wrote:
| VMW-AVGO was held up by the Chinese and South Korean
| regulators - it gets geopolitical. sure would be nice if
| everything was clear and clean for businesses but also it
| would be nice if I had a pony and magic shoes.
| matthewowen wrote:
| This is just straight up factually incorrect: the DOJ never
| filed a lawsuit to block this deal.
| hn_throwaway_99 wrote:
| Your comments are straight up factually misrepresenting
| what happened. There were plenty of news reports early this
| year that DoJ was preparing to file suit against the
| merger. I guarantee they were in close contact with Adobe's
| lawyers, and the normal process here is that Adobe's
| lawyers/execs come back and say "hold up, let's see if we
| can make a deal" - that's essentially what happens in the
| vast majority of lawsuits.
|
| Adobe (and Figma) knew full well this deal wasn't a slam
| dunk from the beginning.
| Dylan16807 wrote:
| Threatening a lawsuit is better than nothing but it
| definitely didn't lead to a quick resolution. At a
| certain point the answer to whether they can make a deal
| needs to be "no", not "we'll wait".
| Bjorkbat wrote:
| I'll admit when I'm wrong. The DOJ announced back in
| February that it was "preparing to sue", but appears to
| have never officially filed that lawsuit. My mistake.
|
| Nonetheless, I think my point still stands in that the FTC
| and DOJ made how they felt about the deal pretty clear.
| jamiek88 wrote:
| Have you mentioned at all in this thread where you are
| vociferously and borderline disingenuously defending your
| employer that you are in fact a figma employee?
|
| Kinda relevant don't you think?
| matthewowen wrote:
| Speaking for myself and not for Figma and I wouldn't want
| to muddy that fact or imply that I have meaningful non-
| public information. I don't think anything I've said is
| either vociferous or disingenuous.
|
| I actually haven't even said whether or not I agree with
| the decision or whether or not I think the timeline is
| reasonable (in the sense of whether the benefits and
| needs of the timeline justify the cost of it), so that
| doesn't seem vociferous to me.
|
| If I was being disingenuous I'd post on a throwaway, not
| an account that you can trivially connect to my identity.
| KptMarchewa wrote:
| You have meaningful non-public motive: probable millions
| to earn if this deal for through.
| matthewowen wrote:
| This deal already has fallen through. What I type here
| has no possible impact. So idk what the motive here
| really is.
|
| I have a bunch of different feelings about it of course,
| but I think what I have said here has been factual and
| verifiable against public information.
|
| One of the things I've always enjoyed about hacker news
| is that it isn't purely a peanut gallery and people
| involved in the companies and technologies we talk about
| do post here. Attributing bad faith to those people when
| they do participate seems antithetical to the spirit of
| this place.
| jamiek88 wrote:
| The DOJ immediately (less than a month) signaled they
| were against this and would sue, you disputing this =
| disingenuous.
|
| You then left seven or eight comments defending that
| error.
|
| It probably wouldn't have come off as so shady if you had
| mentioned your employer in the first place.
| callalex wrote:
| Keep in mind that you are reading a corporate press
| release/propaganda piece, not journalism. It is going to be
| inherently one sided and will not tell the whole truth. Never
| take these kinds of statements at face value.
| Matticus_Rex wrote:
| No one disputes that regulators basically killed this merger.
| hn_throwaway_99 wrote:
| > That's an absurdly long time to be operating a business in
| limbo, and I have to assume it's the regulators dragging their
| feet since the companies have every incentive to move quickly.
|
| Your understanding here is fundamentally wrong. Regulators in
| the US said very early on they were against this merger and
| were going to fight it. So most of what goes on in the meantime
| is Adobe and Figma (a) seeing if they can give something up to
| appease regulators (e.g. it's common for regulators to only
| sign off on a deal if one of the companies sells off some
| assets) or (b) decide if they're going to fight the regulators
| in court.
|
| Your idea of the regulators just "dragging their feet" is
| incorrect
| camhart wrote:
| It seems wrong/illegal that they can just "decide they're
| against the merger" and sink it by dragging their feet. Its
| either legal or not. I haven't dug into the details, but
| based on this one line alone it sounds like this is abuse of
| power.
| true_religion wrote:
| It seems they are saying the merger as is will be illegal,
| however they give both companies some time to do something
| that will make the deal work. 15 months is a short time if
| you have to sell enterprise assets or let competition
| emerge to show the merger isn't a danger to the market.
|
| If companies want a fast answer they can ask for one and it
| will be no.
|
| All said I do not worry about if billion dollar companies
| are being fairly treated. They have the capital and
| expertise to protect their own interests and it's not worth
| it to preemptively fight on their behalf.
| SomeCallMeTim wrote:
| Another way to say "decide they're against the merger" is
| "evaluate the situation and make a timely ruling that they
| oppose the merger as illegal."
|
| Which is exactly what they were supposed to do. Adobe and
| Figma tried to argue with the regulators or find a
| compromise, but couldn't come up with a solution that
| satisfied all parties.
|
| If you try to extract subtle implications from the phrasing
| of a commenter on HN, you're likely to jump to the wrong
| conclusion.
| robertlagrant wrote:
| But that's the point: it's not timely. It's a massive
| millstone to Figma, who now have to figure out what to do
| with their pixel-perfect UI designer collaboration tool
| in a world of an and coming Adobe Firefly.
| hn_throwaway_99 wrote:
| > Its either legal or not.
|
| Perhaps I should introduce you to the legal system? Adobe
| proposes the merger, DoJ says they will sue to stop it. At
| that point, if the parties can't come to an agreement, it
| goes to the courts.
|
| I think it's fine to argue our legal system is too slow,
| but again, this idea that regulators are just "dragging
| their feet" to slow things down is fundamentally incorrect.
| Regulators announced quite quickly they would fight this
| deal.
| Matticus_Rex wrote:
| Welcome to the world of antitrust, where almost everything
| is in a grey area and vibes-based. Never seen anyone who
| studied this area (and who didn't already work for a
| related Federal agency) who didn't conclude that this was a
| big mess, no matter their opinions on how it _should_ work.
| happytiger wrote:
| They literally indicated they were against it from early
| on, but Adobe tried to brute force it through and after
| careful review they said, "still no."
|
| Also, it's not as if Figma has been sitting around all this
| time waiting for their dear Adobe to close. My
| understanding is that more than 500 new people have been
| hired since the deal was announced (total is now like
| 1300+) and growth continues.
|
| I'm just glad Figma can now move on without having to do
| some "roadmap alignment exercise" or doing the "gradually
| falling apart" that so many Adobe acquisitions have done.
|
| The real thought should be why Adobe was willing to pay
| twice the recent valuation to take Figma out as a
| competitor, and why only European regulators had a problem
| with it. They have a tendency to kneecap anyone who's a
| substantive threat to their market, and we _need_ viable
| competition in the space.
|
| It may not have been particularly timely in terms of
| review, but it was never inconsistent. And we have no idea
| what kinds of delays were put on the deal, including delays
| from the Figma and Adobe teams.
| matthewowen wrote:
| This is a really inaccurate factual understanding of the
| sequence of events here: I would urge you to look at the
| actual timeline of events around the CMA and the DOJ before
| you keep spreading it.
| hn_throwaway_99 wrote:
| This article about the DoJ prepping to sue to stop the deal
| is from February:
| https://www.bloomberg.com/news/articles/2023-02-23/doj-
| prepa...
|
| The idea, proposed by the comment I was responding to, that
| regulators were just twiddling their thumbs and then only
| gave a thumbs down to Adobe after 15 months is wrong and
| completely misunderstands how the regulatory process for
| merger approval works.
| jasonlotito wrote:
| It's actually much earlier than that.
| https://news.ycombinator.com/item?id=38685644
|
| tl;dr: Their was significant action less than a month
| after the announcement was made.
| matthewowen wrote:
| It also said the lawsuit would be filed "in February or
| March", but it was never actually filed, so what factual
| relevance do you think that article really has? Moreover,
| the DOJ wins less than one in three of these kinds of
| cases: the US system is an adversarial one where the
| courts decide so it makes no sense to immediately abandon
| in the face of DOJ opposition.
|
| What is also true is that the uk finished its phase 1
| review (where they decide to send it for further phase 2
| review) in June, so 9 months after the deal was
| announced. Phase 2 leads to changes in about 50% of
| deals. The phase 2 deadline was late February 2024, about
| 18 months later.
|
| I don't think any of this is indicative of anyone sitting
| on their hands or twiddling their thumbs, but it's
| clearly a slow process and that uncertainty clearly isn't
| good for the parties involved.
| jasonlotito wrote:
| https://www.politico.com/news/2022/11/02/doj-review-
| adobe-20...
|
| That's a little over a month after the announcement was
| made. That is "very early on" in the 15 month "sequence of
| events."
|
| Keep in mind, this was the announcements. FTA: "The DOJ has
| been contacting customers and competitors of Adobe and
| Figma, as well as Figma's venture capital investors, in
| recent weeks, the people said. According to one of the
| people, the DOJ has already issued civil investigative
| demands -- information requests similar to subpoenas -- an
| unusual move at this early juncture in the probe."
|
| So, we are talking about significant action being taken
| less than a month after the announcement.
|
| I'll grant you "very early on" is subjective, but I feel
| any reasonable person would say that this constitutes "very
| early on".
|
| In short, I would urge you to look at the actual timeline
| of events around the CMA and the DOJ before you keep
| spreading an inaccurate factual understanding of the
| sequence of events here.
| matthewowen wrote:
| https://news.ycombinator.com/item?id=38685680 (it doesn't
| seem ideal to post substantially the same reply in two
| places)
| sklargh wrote:
| The regulators moved fast. I had detailed conversations with
| regulators about this merger weeks after it was filed. They
| moved extremely quickly to signal that they were going to
| block it.
| BobaFloutist wrote:
| _you can expect a serious chilling effect on M &A._
|
| Promise?
| xvector wrote:
| Not a good thing when it's taken to absurd lengths. See Lina
| Khan's attempt to block the Within Unlimited acquisition. The
| problem with the current administration is that there's no
| good-faith path forwards to get anything done. If you have
| worked with the FTC recently you'd understand what a hostile
| clusterfuck it is.
| briffle wrote:
| you should really link to something about it that your
| specifying. Cause it really looks simiar to blocking
| Microsoft from buying Activision.. A company that makes the
| hardware trying to buy up all the independant software
| vendors and have them only make software for their hardware
| is getting really, really old. I think the only people that
| would complain are the ones who would directly benefit.
| avarun wrote:
| Microsoft plus Activision combined is about 6% of the
| gaming industry. "buy up all the independent[sic]
| software vendors" is some serious hyperbole.
| BobaFloutist wrote:
| I want it to be taken to absurd lengths. If and/or when the
| negative ramifications of discouraging mergers/acquisitions
| even begin to approach the damage that encouraging them has
| done to our economy and society, and only then, we can
| consider slowly reducing the pressure against.
| xvector wrote:
| M&A has done far more good for society than damage to it.
| A lot of human achievements are only achievable with
| scale.
|
| It makes zero sense to discourage a non-monopolistic M&A.
| BobaFloutist wrote:
| There are other ways to scale.
| JAlexoid wrote:
| When it comes to whole market altering merger - they don't take
| that long.
|
| The negotiations took that long, to come to nothing. Clearly
| Adobe couldn't come up with a solution to the problem of a
| potential monopoly.
|
| Most M&As happen quite quick, mostly dealing with acquiring
| companies that are outside of the purview of regulators.
| jorblumesea wrote:
| Regulators were always opposed to this merger, it's Adobe that
| wanted to fight it out.
|
| > you can expect a serious chilling effect on M&A
|
| Oh no, less corporate consolidation. The horror. Won't someone
| think of the capital class for once?
| jasonlotito wrote:
| > How in the world did it take fifteen months for regulators to
| reject this?
|
| They didn't. They started seriously investigating it less than
| a month after the announcement and publicly shared this
| information just over a month later.
|
| > but regulators need to make up their minds quicker
|
| They did. Adobe and Figma were trying to appease regulators by
| figuring out if there was a way to handle their concerns. They
| aren't willing to divest themselves enough from their existing
| portfolio or offer concessions.
|
| If you want them to make up their minds quicker, then the
| default answer should be No. With weeks not even being an
| acceptable time frame for action, anything other than No is
| harmful.
|
| https://www.politico.com/news/2022/11/02/doj-review-adobe-20...
| jzb wrote:
| "I have to assume" -- you do? Why?
|
| The DOJ already signaled it wanted to block this on antitrust
| grounds almost a year ago. If "regulators" had immediately
| rejected the deal, there'd be a similar "oh, this will have a
| chilling effect" complaint because they slapped it down without
| adequate due diligence.
|
| This is one M&A deal out of many. The vast majority -- even
| some that shouldn't be approved IMO -- sail through or squeak
| through due to persistence. I just can't find it within myself
| to feel bad for Adobe in this, since the most likely outcome
| was to just solidify Adobe's grip on the market and reduce
| competition. I know quite a few people who use Figma who were
| absolutely dreading this merger.
| mrandish wrote:
| > How in the world did it take fifteen months for regulators to
| reject this?
|
| I agree with your overall point that the current regulatory
| process related to anti-trust M&A very much needs to be
| improved. While the delay may be the proximate cause, focusing
| on that risks failing to address the fundamental root cause of
| the problem, which is A) lack of clarity in regulatory policies
| and the underlying laws authorizing them, and B) their
| inconsistent application across different industry contexts and
| between different international jurisdictions.
|
| The lack of clarity can be improved by regulators adopting
| clearer public guidelines about how they will interpret and
| apply the rules (and then establish credibility by actually
| sticking with those guidelines over time). Improving
| consistency across jurisdictions is more challenging but still
| possible if regulators in the largest domains (US and EU)
| collaborate to harmonize their policies (as is done in many
| other regulatory contexts).
|
| Recently, Lina Khan in the US has made this problem far worse
| by aggressively pursuing quite extreme interpretations of anti-
| trust law, and worse, doing so without establishing any
| corresponding framework or justification. As a result, this
| bungling has caused her agency to lose several high-profile
| cases. So far, much of this bungling seems to be "just for
| show" (ie political posturing) since it's not working.
|
| Unfortunately, it also has the effect of nerfing the market for
| entrepreneurial exits via acquisition. While it's true that
| acquisitions large enough to attract anti-trust scrutiny are
| outliers, much of the money invested in earlier stage startups
| (which drives most new job creation in the US), is justified by
| average returns substantially propped up by a few such >100x
| acquisitions. Half the extreme high-end outliers being lopped
| off by regulatory uncertainty around large acquisitions is one
| reason capital for new business creation and growth is getting
| scarcer and more expensive. The point being, this matters to
| our industry and jobs.
| wins32767 wrote:
| > earlier stage startups (which drives most new job creation
| in the US)
|
| This is absolutely not true.
| mrandish wrote:
| I was referring not to just valley tech startups but
| investing in new small businesses overall. Per the U.S. Gov
| Small Business Administration:
|
| > _" Despite the jobs lost during the recession, large
| businesses generated 6.7 million net new jobs over the past
| 25 years. During the same period, small businesses
| generated 12.9 million net new jobs, meaning small
| businesses have accounted for 66 percent of employment
| growth over the last 25 years."_
|
| https://advocacy.sba.gov/wp-content/uploads/2022/04/Small-
| Bu...
| mkl wrote:
| That's about the size of the business, not about being
| new and rapidly growing. I think the large majority of
| small businesses are not startups.
| mrandish wrote:
| > _" 18% of small businesses fail within their first
| year, while 50% fail after five years and approximately
| 65% by their tenth year in business. This information is
| as per the Bureau of Labor Statistics."_
|
| https://www.chamberofcommerce.org/small-business-
| statistics/
|
| Combined with the long-term (25-year) data I cited
| further above, this indicates the majority of small
| businesses are started up recently. The pool of small
| companies is constantly turning over and refilling with
| new startups - of which the vast majority die in less
| than ten years and a very few grow to be large companies
| (thus no longer counted in the pool). By definition, the
| shape of the small business pool must be a very slender,
| very long curve when graphed by employee count.
|
| I think the tech community has perhaps a different set of
| connotations associated with the term "startup" than the
| non-tech, non-valley populace. The _vast_ majority of
| startups (ie small companies started in the past five
| years) aren 't technology companies and aren't fast
| growth. Yet there are so many of them, they comprise two-
| thirds of new job creation. Even better, many of these
| newly created jobs are entry-level, don't require
| advanced degrees or rare skills and don't require
| relocation to costly and crowded urban centers.
|
| I think this misconception of small businesses is pretty
| common in the high tech community. Before I was a tech
| entrepreneur in the valley, I started out as a non-tech
| entrepreneur far from the valley. Then I was a tech
| entrepreneur far from the valley, in a mid-western U.S.
| state. Despite being in the fairly large state capital,
| the largest regional newspaper wrote a story about "Tech
| Companies Here in the Capitol", citing my software
| startup and the local Radio Shack store as the only two
| :-). Yet the local Chamber of Commerce, Small Business
| Administration and entrepreneurship clubs were
| overflowing with pre-launch and just launched new
| startups ranging from a new kind of farm animal feed
| distributor to sandwich shops to (non-franchise) local
| restaurants to karate studios. Together these small
| businesses employed thousands of people in a city whose
| population could probably all fit within a few square
| blocks of NYC.
|
| I also want to point out, the organic, diverse, self-
| renewing nature of small business reality outside the
| tech, valley, urban bubbles is incredibly encouraging. As
| much as I love tech (and how rewarding it's been for me
| personally), I'm thankful the fickle, boom/bust,
| incestuous nature of high-tech startups is statistically
| the rare exception of new companies being started which
| drive new job creation.
| mkl wrote:
| Well, I'd just call those new businesses, but
| dictionaries agree with you. I was using Paul Graham's
| definition of "startup", which is something more
| specific: http://paulgraham.com/growth.html. That's about
| growth, not tech, so feed distributors could qualify.
| tick_tock_tick wrote:
| The current administration has made it very clear they will
| block nearly all attempts at mergers and if they can't block it
| will drag the process out as long as possible to make it as
| unappealing as possible.
| pininja wrote:
| > Figma's founding vision was to "eliminate the gap between
| imagination and reality."
|
| While this is the first time I've seen their vision written down,
| it feels like they've done a great job in fulfilling this
| initially for software product design. Excited to see what comes
| with a renewed independent focus!
| wkirby wrote:
| Good.
| htrp wrote:
| How much does figma lose from a year's worth of operational focus
| being distracted by this impending merger?
| peanuty1 wrote:
| Adobe is paying Figma a 1 billion dollar breakup fee this week.
| Sounds like a very good deal for Figma.
| michelb wrote:
| I guess not much seeing what they have been shipping.
| azemetre wrote:
| Maybe not much. They've released some big things like dev mode
| that have been in the making for a while.
|
| They've obviously still developed new features and fixed bugs,
| along with future roadmaps as shown in their showcases.
|
| It's not like they had the entire company focused on this but
| likely hired an outside firm to walk them through it.
| wmeredith wrote:
| Oh thank god. I've used Adobe tools professionally for about two
| decades now. They are too big, and their software suffers for it.
| Sigma is rad. I'm glad they aren't going to get enshitified by
| Adobe.
| Ericson2314 wrote:
| Renewed anti-trust is an interesting experiment. I don't what the
| consequences will be, but I am excited to find out!
|
| If a nothing else, I want people to think "we should try more
| policy experiments to become wiser" rather than "oh no, effect
| uncertain, better stick with status quo".
| gunapologist99 wrote:
| How is this an experiment? Don't we remember Standard Oil,
| AT&T, DOJ vs MS, etc?
| __loam wrote:
| Yeah it's more like the regulators are trying to do their
| jobs again after decades of the failed hands off approach.
| altairprime wrote:
| People don't remember cassette tapes, much less robber barons
| and monopoly breakups of the 20th century.
| locallost wrote:
| Renewed anti-trust. It hasn't been enforced in a long time.
| Ericson2314 wrote:
| The experiment is quickly varying the policy. Trying to
| compare n=1 decades apart, in the century that saw the
| greatest change in human history (so far), is a cool
| intellectual exercise but not simple-stupid enough to be
| empirical.
| stjohnswarts wrote:
| I think on average, more competition is better for consumers
| than all these massive oligopolies. I doubt it is for
| stockholders, though, especially those who want to ditch the
| stock soon.
| lewisjoe wrote:
| I'm wondering why is there zero competition for Figma? I
| understand their app is basically a browser-like engine running
| inside the browser - which is cutting-edge tech, tough to copy,
| etc.
|
| But given enough interest in this space and the valuation Figma
| has now - I'm wondering why isn't other big tech companies not
| building their own Figma alternatives.
| rosywoozlechan wrote:
| Isn't Zeplin a competitor?
| karaterobot wrote:
| Zeplin doesn't do what Figma does, but Figma does what Zeplin
| does, if that makes sense. You wouldn't stop using Figma and
| use Zeplin instead, you'd only supplement your Figma license
| with Zeplin if you thought Zeplin did design handoff better
| than Figma (maybe it does, I haven't used it in years, but
| that wasn't the case a few years ago).
| enos_feedler wrote:
| I will suggest that perhaps: 1) because the valuation is wrong?
| 2) because Figma has not actually created a new
| category/market? this is where you get new entrants into the
| market. Take AI chips for example.
|
| I think its entirely possible that Adobe has realized 1) and/or
| 2) and didn't fight all that hard to make the deal work?
| corkscrew wrote:
| Sketch
| Solvency wrote:
| Because literally 90% of developers today are wholly incapable
| of producing the cutting edge performance Figma requires. It's
| an engineering marvel. It's like wondering why more people
| can't just compete in F1. Money and talent at the rarest
| levels. Most companies engineer at the performance level of
| Atlassian. Which is not remotely sufficient.
| bobobob420 wrote:
| where can i read more about the engineering behind Figma? Is
| it not just a UI for rendering polygons? Is all the
| technology in getting high performant rendering on top of a
| javascript engine? If so that doesn't seem like anything that
| crazy.
| dharmab wrote:
| The hard part is the multiplayer editing, which works
| seamlessly with quite large groups, even on less-than-ideal
| internet. You can even see everyone's mouse cursors moving
| in real time! This is something most video games struggle
| with, let alone productivity tools.
|
| https://www.figma.com/blog/how-figmas-multiplayer-
| technology...
| havefunbesafe wrote:
| I'd direct you to Figma's incredibly impressive patent
| portfolio https://patents.justia.com/assignee/figma-inc
| npunt wrote:
| That's like 7 patents, not sure it's particularly impressive
| from a tech patent portfolio perspective unless a few of them
| are real bangers, and/or Figma is known to be litigious which
| I don't think they are?
| lhnz wrote:
| Counterintuitively this will lead to more monopolies since with
| less likelihood of "exiting" startups via mergers and
| acquisitions there'll be reduced interest in venture capital and
| therefore fewer startups capitalised to the extent that they can
| compete against large monopolies.
| yandie wrote:
| If you think VCs are rational, you'd be in for a fun ride.
| lhnz wrote:
| I don't think that you need VCs to be rational for what I'm
| saying to be true.
|
| LPs will see this as reducing the likelihood of making their
| money back via investing in VCs -- or at least, this is a
| reasonable theses, and those that grow their customer's funds
| the most might make this assessment. In the long-term this
| would transform the landscape of VC which is downstream from
| institutional investors.
|
| It can also have a cascading effect due to how reports and
| disclosures over investment strategies get shared and firms
| benchmark themselves against leading firms.
| wantsanagent wrote:
| Can Figma issue bonuses out of the $1B payout?
| echelon wrote:
| That would be a really smart move to keep employees motivated.
| They're probably extremely upset and anxious about this deal
| falling through.
| Andrew_nenakhov wrote:
| Many employees will say thanks and go on updating their
| resume: surely you don't expect more generosity in the
| future.
| MenhirMike wrote:
| So, which company is Figma going to try to sell itself off to
| next? Atlassian maybe? I guess that Microsoft wouldn't be
| interested since they abandoned Expression/Blend/etc., Apple
| isn't in the market for web tools, and Miro is probably too
| small. So, Atlassian makes some sense to capture more of the
| developer audience.
| gigglesupstairs wrote:
| I think on the contrary, Microsoft may look into it as another
| AI driven or AI enabled product that can deliver UIs on the
| fly, and hence can attract creative crowd towards them. TBH,
| possibilities are limitless.
| tsycho wrote:
| [Pure speculation; I don't work in the UI space at all, and at
| neither of these companies]
|
| I wonder if Adobe is secretly happy about this. They were
| acquiring Figma at the peak of the market (for growth
| stock/startup valuations) because of the existential risks that
| Figma was threatening, due to their collaborative development UX.
|
| But since then:
|
| * Startup valuations have fallen. Ignoring regulatory concerns, a
| new acquisition deal today would be cheaper.
|
| * Gen AI and Adobe Firefly are the new rage, and Adobe has
| probably captured back both mental and market share from Figma.
| And Adobe can now add collaborative features to Firefly, and it
| doesn't even have to be as good as Figma's to win.
|
| So paying the 1B breakup fee is probably the cheapest and best
| option for Adobe at this time.
|
| Meanwhile, Figma employees, expecting a big payout, are probably
| a bit demotivated at this point. And potentially, they might have
| been working on integrating into Adobe over the past year, so
| they might have even slowed down in their development pace.
| omnimus wrote:
| Adobe Firefly is cute but it wont get you any customers from
| Figma because it's different product for completely different
| purpose.
|
| Figma has something that Adobe lacks and wanted probably more
| than Figmas customers. Huge database of essentially all web/ui
| design done in past 3 years. If Firefly is such a hit wait once
| FigmaAI will start generating their stuff.
|
| Also it doesn't seem Figma as product was slowed too much -
| they have recently launched dev mode. One of the biggest
| features in a while. That put them more ahead of the
| competition.
| dumbo-octopus wrote:
| > Adobe has probably captured back both mental and market share
| from Figma
|
| Unlikely. Based on the google trends [1], Figma sees around 10x
| more traffic than Firefly, but more importantly it experiences
| severe weekend drop-offs, meaning people are using it for work.
| Firefly on the other hand has a constant amount of attention,
| in line with people playing around with it but not committing
| to it for serious projects.
|
| Anecdotally I work in UI/UX space as a contractor and I've been
| given every design in Figma, I hadn't even heard of Firefly
| until this comment.
|
| [1]
| https://trends.google.com/trends/explore?date=today%203-m&ge...
| DoesntMatter22 wrote:
| Things happen quickly and AI will change things quickly.
| Figma is nearly 8 years old and Firefly isn't even a year
| old.
|
| Of course a massive tool is going to be bigger than a very
| new tool and there is a lot of momentum at companies.
|
| The future is going to be AI/prompt based because it's a 100x
| speed savings. Who wins that pie is up for debate but Figma
| as it stands right now is very disruptable.
| coldtea wrote:
| > _Things happen quickly and AI will change things
| quickly._
|
| Yes, but oversold hype also dies quickly, not changing much
| in the end.
| DoesntMatter22 wrote:
| That is a very silly way of viewing things. AI has
| already dramatically change logo creation and all sorts
| of image generation. The impact on design is already
| being felt and is going to rapidly increase.
|
| The cost savings are immense.
| gibbitz wrote:
| Sadly this is how we look at art thanks to AI. "It's just
| like a real person thought about it and made it
| intentionally -- but it's nearly free!". No one paying
| cares if it's just copied from other works and nearly
| randomly put together at the expense of those who can
| barely make a living doing it. Why don't we focus more on
| automating C-suite jobs? That's where a lot of corporate
| costs come from. Automating a logo design saves you 20k
| or likey (much) less. Automating a corporate merger saves
| you millions of dollars and years of time.
| DoesntMatter22 wrote:
| I am incredibly happy about this. Otherwise it's like
| lamenting the invention of the car because it would
| eliminate all the jobs making buggies and whips.
|
| > No one paying cares if it's just copied from other
| works
|
| There are probably zero artists alive who didn't learn by
| copying other works or learning to make art in that
| style.
|
| It's no different with an AI. An AI is something that
| learns from others and creates it's own art. There isn't
| anything illegal about it any more so than you learning
| to draw and making characters that are similar to Mickey
| Mouse. You can trademark a specific thing but not a
| style.
|
| So at the end of the day, how is it any different than a
| person doing it other than the fact now a person won't be
| getting paid?
| coldtea wrote:
| > _I am incredibly happy about this. Otherwise it 's like
| lamenting the invention of the car because it would
| eliminate all the jobs making buggies and whips._
|
| Between road accidents, air pollution, noise, horrendous
| cities and suburbs built around car use, and so on, I
| don't mind lamenting the invetion of the car either...
|
| In general it's pretty naive to celebrate new
| technologies without considering drawbacks. Especially if
| they are just stuffed down everyone's throats, whether
| they want them or not, and even more so if the technology
| has the potential to eliminate human creativity and
| cheapen creative output. Even more so if the technology
| has so much potential for abuse (for government
| surveillance, automated spam, all the way to far worse
| cases, so much so that even its creators warn about the
| potential existential threat).
|
| I guess what's the remove of creativity, or the
| existential threat, and countless of other negatives,
| compared to cheap logos, or (assuming it lives up to hype
| the way you say) killing off graphic design as a
| profession?
|
| > _So at the end of the day, how is it any different than
| a person doing it other than the fact now a person won 't
| be getting paid?_
|
| In the removal of human creativity in the design, and its
| delegation to an algorithm.
| DoesntMatter22 wrote:
| > even more so if the technology has the potential to
| eliminate human creativity
|
| This is completely overboard. People will always be
| creative. There is no way in which this stops anyone from
| being creative but actually allows not artists to be much
| more creative.
|
| It also allows the same for artists as they can now
| create in styles they aren't skilled in.
|
| > killing off graphic design as a profession?
|
| It likely will dramatically kill it and free up those
| people for other types of jobs as they can now be more
| productive.
|
| Humans will still continue to be creative and draw and
| paint. That won't change.
|
| No reason to hold society back just to hold on to some
| jobs
| coldtea wrote:
| > _This is completely overboard. People will always be
| creative._
|
| Just not in the fields where AI will replace them? Hardly
| a consolation that "people will always be creative" in
| e.g. interpretive dancing, if the music in our culture
| end ups being dominated by AI musak.
|
| And I don't just care for my own music consumption, to be
| consoled that "some people will still be doing human
| music". I also care about the role of music in society in
| general.
|
| I'd say the same for graphic design and illustration.
| Yeah, some people will be creative in those fields still.
| But I don't care for a world where 90% of the
| illustrations and graphic design we see are AI crap.
|
| And I'm not saying it because AI does great
| illustrations, but because it does crap illustrations
| cheaper - which for the undiscerning manager will be
| "good enough", and for spam farms and the like will be a
| godsend.
|
| > _It likely will dramatically kill it and free up those
| people for other types of jobs as they can now be more
| productive._
|
| > _Humans will still continue to be creative and draw and
| paint. That won 't change._
|
| No, just the ability to make a living out of it, as
| opposed to getting a drab office or factory job will.
| That, and being confronted 24/7 by AI "art", would be the
| changes.
|
| > _No reason to hold society back just to hold on to some
| jobs_
|
| Who exactly did sign up for that, and who said this is
| "forward" and not following it's "holding back"?
|
| Not every BS we invent is a possitive. Nor is "increased
| technology" == "better".
| DoesntMatter22 wrote:
| >> People will always be creative. > Just not in the
| fields where AI will replace them? ... if the music in
| our culture end ups being dominated by AI musak.
|
| Will AI dominate music? Probably. Is there anything that
| can be done to stop that? No. Even if you outlawed it in
| the US it won't stop it. It's coming and there is nothing
| that can be done. If that is a good or bad thing IDK.
| Most modern music is so awful that to me this doesn't
| matter anyway.
|
| > but because it does crap illustrations cheaper
|
| The work it outputs is astounding, if it was crap no one
| would want to use it.
|
| >>Humans will still continue to be creative and draw and
| paint. That won't change. >No, just the ability to make a
| living out of it, as opposed to getting a drab office or
| factory job will.
|
| AI is coming for factor and office jobs too. But yes this
| will cut the ability to make money on it.
|
| > Who exactly did sign up for that, and who said this is
| "forward" and not following it's "holding back"?
|
| It doesn't matter what someone signs up for. That's not
| how the world works. More efficient processes take over
| less efficient ones. Paying someone 7k to work on
| something for 2 weeks is much less efficient than
| generating a similar image in 2 minutes for 25 cents.
|
| Few people are going to be so enamored with the image
| that it would matter if it's not quite as good (though it
| may be better).
|
| > Not every BS we invent is a possitive. Nor is
| "increased technology" == "better".
|
| Anything that increases efficiency without hurting people
| is a good thing and it's why we enjoy the quality of
| living we do now.
| dumbo-octopus wrote:
| > without hurting people
|
| What is your metric for "hurt" here? Direct, acute,
| physical pain? What about chronic depression resulting
| from lack of gainful employment?
| DoesntMatter22 wrote:
| That's the price to pay for all the technological
| advancements we've had. These people will find other
| gainful employment
| dumbo-octopus wrote:
| Tell that to the current depression epidemic. The fact of
| the matter is people are sick and technology is to blame.
| coldtea wrote:
| > _That is a very silly way of viewing things. AI has
| already dramatically change logo creation and all sorts
| of image generation._
|
| It "changed" the logo creation tier which was already
| "changed" by Fiverr $10 logos, logo-making apps with
| recombinable logo graphics, and so on.
| bluishgreen wrote:
| " Adobe can now add collaborative features to Firefly" - Except
| they won't. If you have been inside old big tech companies
| you'd know. Hard for me to articulate though. An open
| acknowledgment of this phenomenon is Satya staying out of
| OpenAI and still sucking the milk. They can never hope to move
| the same. Sathya's brilliance is that he decided and quietly
| said to himself and his board.. "And that's ok". Being humble
| brought MS back into the race. Adobe should have done the same
| with Figma.
| poisonborz wrote:
| What does Gen AI and Adobe Firefly has to do with Figma? Not
| even the target group is similar - Figma didn't even try to
| touch raster/illustration. Building or acquiring a product is
| not a one-shot try at a popularity contest.
| scubadude wrote:
| >What does Gen AI and Adobe Firefly has to do with Figma?
|
| Something something blockchain
| zamadatix wrote:
| > So paying the 1B breakup fee is probably the cheapest and
| best option for Adobe at this time.
|
| Do they still have to pay the fee if the reason was regulatory
| in nature?
| vmatsiiako wrote:
| Yes. They do
| tempsy wrote:
| Badly run startup valuations fell.
|
| The good SaaS cos that are publicly traded are almost all
| closer to highs than lows.
|
| The company is still likely worth at least $10B if not much
| more.
| RickS wrote:
| (ex-Adobe, on a team highly related to an area where Figma out-
| executed XD, less knowledge about genAI stuff)
|
| > Adobe has probably captured back both mental and market share
| from Figma
|
| GenAI/Firefly's success is in a totally different domain to
| what Figma's doing. Figma's equivalent at Adobe is XD, which
| has never held a candle to Figma. The existential problem Adobe
| tried to buy their way out of still exists in the same form at,
| if anything, a greater severity. I was at Figma's config conf
| this year and they're finally shipping stuff I tried
| unsuccessfully to get from the XD team _years_ ago.
|
| > potentially, they might have been working on integrating into
| Adobe over the past year
|
| Highly, highly unlikely. I have no insider knowledge of Figma,
| but Adobe's a grown up company and _really_ does not fuck
| around on the legal stuff (which is part of the basis of
| Firefly's success - significantly cleaner legal provenance on
| their training data). Everyone I've spoken to at Adobe says
| they've been kept at a long arms length.
| ska wrote:
| Curious: would you say that's reflective of Adobe's dev
| culture as a whole? I heard some similar comments coming out
| of a (claimed?) Lightroom developer about the motivations for
| that project...
| dharmab wrote:
| Also ex-Adobe, worked directly with regulatory compliance
| in my role there. Adobe is a huge company with a diverse
| set of dev team cultures, but is a monoculture in regards
| to legal and regulatory compliance. They do not fuck
| around. (They're also very serious about security
| post-2013.)
| lucubratory wrote:
| What happened in 2013?
| organsnyder wrote:
| https://arstechnica.com/information-
| technology/2013/10/adobe...
| lucubratory wrote:
| Thank you, I appreciate the link
| doctorpangloss wrote:
| > (which is part of the basis of Firefly's success -
| significantly cleaner legal provenance on their training
| data).
|
| Yeah... I mean the pre-trained text encoder Firefly uses is
| filled with copyrighted, unlicensed-for-express-purpose
| training data.
|
| Firefly is successful in the same sense that DocuSign is, in
| that it is selling a holistic social experience, but I think
| maybe don't opine on "legal provenance on their training
| data" until you have seen the whole pipeline with your own
| eyes. Sophisticated people sort of know Adobe's claims are
| bullshit, but what exactly do you expect the community to do,
| speculate on the exactly zero evidence Adobe has shown of how
| any of their stuff works?
|
| Anyway, I am pretty sure Adobe is delighted they are not
| paying $20b for something that is worth way, way less. Like
| maybe $500m at most.
|
| Meanwhile the people _using_ Figma at many companies are
| getting laid off. Etsy, Bytedance, Unity Spotify, Salesforce
| all made massive UX designer cuts.
|
| The real question is, is the thing people are using Figma for
| even worth $20b? No, no way. Figma users work in the Making
| Bugs department: they make new buggy things nobody asked for,
| that aren't lists or spreadsheets but should just be lists
| and spreadsheets, which makes everything worse. There is
| nowadays positive ROI to doing _less_ Figmaing. In my opinion
| there has _always_ been more ROI to doing less Figmaing, to
| straight up not having those people around and not gathering
| so many opinions on designing lists from so many
| stakeholders. That holistic experience is expensive in _many_
| ways, and while again you can be successful delivering that,
| it doesn 't mean it makes sense.
|
| Just look at the Spotify app. It's a hot abject mess of
| absolute garbage UI. They have been diehard Figma users for
| years. They are the prime example of Figmafication ruining
| something extremely simple. It's fucking lists! Lists are not
| worth $20b.
| zombiwoof wrote:
| nailed it
| seanmcdirmid wrote:
| That is a pretty cynical take on what UX designers do. The
| PMs should be dealing with lists and spreadsheets, often
| they don't and just tell the designer to just design the
| product in a mock. It isn't the way things should go, just
| like how having programmers decide the UX while they are
| programming the UI leads to disaster.
| aliston wrote:
| What's so bad about the Spotify app? For the most part, it
| looks like a bunch of lists (not so much spreadsheets) to
| me...
|
| As someone that is only tangentially in the design space,
| why do you think collaborative design works so poorly? I
| have noticed that, in engineering reviews, complex backend
| designs get scrutiny, but rarely "I feel..", "I prefer..."
| types of comments, whereas frontend teams get all types of
| those comments. Is it a matter of too many cooks in the
| kitchen or something else?
| doctorpangloss wrote:
| This is a stylized comment.
|
| It is a bunch of lists, but the UI is sometimes the lists
| are scrolling horizontally album covers, sometimes they
| are popping up from menu buttons, sometimes they go full
| screen and scroll normally, sometimes they are cut short
| to 5 elements and you cannot see more, sometimes they
| continue to 20 elements and you can press to see more,
| sometimes it's a list with headers that all contain more
| than a presentable number of elements and you have to tap
| the header to see more, sometimes it's a mix of
| horizontal and vertical scrolling sections, sometimes
| it's squares and sometimes it's rectangles, sometimes
| your whole list is shrunk because of a popup up top that
| is _going through a list_ of items they want to notify
| you about but the popups are shown one session at a time,
| sometimes they have a full screen popup that is going
| through that list of items, sometimes you are driving
| your car or trying to find a song for a baby or trying to
| do your run and you are being shown many different kinds
| of lists when a simple, scrolling up and down list with a
| search box would be preferred, but instead there is so
| much stuff they want to show you in these lists in so
| many different shapes that you didn 't ask for.
|
| Do you know what the provenance of this morass is, at
| Spotify? There are many, many Figmas, each a UX designer
| hoping to reinvent the list in their own way, various
| product managers competing for attention from the user to
| introduce a Feature and Increase Engagement for their Key
| Performance Indicators. The user is better served without
| any of this stuff.
|
| Man, have you seen the Google Maps and Gmail apps? Google
| doesn't use Figma either, but the ethos isn't unique to
| Spotify, it is absolutely toxic. The amount of crap I can
| accidentally tap on while driving using Google Maps,
| telling me information I absolutely do not care about,
| trying to get me to Do Something for Some Product
| Manager's Product: it's negative ROI.
|
| > why do you think collaborative design works so poorly?
|
| To me, using Figma is a symptom of the incompetent people
| outnumbering the opinionated and competent. It's not so
| much that collaborative design works poorly, I'm sure it
| works very well in Apple's design org. But that's not
| what the Figma product is. It's a holistic social
| experience of giving 10x as many people the ability to
| inscribe their opinions and get credit for participating
| in a project, as corporate people do, which is very
| valuable to 10 subscribers as opposed to the 1 person
| actually doing the work. It's a great business!
| remoquete wrote:
| As a UX writer, the ability of providing feedback or
| editing UI text before a disastrous piece of Loren Ipsum
| goes to production is very, very valuable. What's the
| feedback you think is silly here?
| jbl0ndie wrote:
| I believe that's what Cory Doctorow calls
| 'enshittification'. I don't blame UX designers and Figma
| for it though, and I think this comes from the corporate
| stakeholders rather than the PMs. Full disclosure, I'm a
| PM similarly annoyed by the enshittification of once
| excellent apps. Maybe too many large companies are stuck
| releasing features on a regular cadence without many
| interesting user problems to solve.
|
| https://en.wikipedia.org/wiki/Enshittification#%3A%7E%3At
| ext...
| gibbitz wrote:
| 100%
| yawnxyz wrote:
| (I'm a UX engineer but not at Spotify)
|
| It's always been wild to me how incongruous /
| inconsistent the experience of using Spotify's
| web/ios/android apps have been. It points to an
| organizational mess rather than a Figma mess, but maybe
| it also shows that Figma doesn't address the entire
| picture yet of addressing org level communication and
| syncing with prod assets
| doctorpangloss wrote:
| At least to the specific, valuable role of a UX designer,
| the biggest problem with Figma is it has no opinions or
| affordances for improving HCI. The best UX designers have
| strong HCI opinions and Figma does nothing for them. It
| is fundamentally a tool to (mis)-style lists. So it is
| unfortunate it is adopted as much as it is, UX designers
| should be spending their intellectual energy on more
| scientific stuff.
|
| > It points to an organizational mess rather than a Figma
| mess
|
| The two are related. It's like Conway's law.
|
| Figma has some pretty generic opinions about how apps or
| shit should be made. (https://www.figma.com/blog/working-
| well/). Like it has this collaborative editing
| multiplayer thing going on, but you could just ignore
| that, many bosses effectively use it to tell subordinates
| exactly what to do without any feedback. Nonetheless they
| have countless public materials espousing the things it
| can do and how using those features to the max,
| especially collaboration, is the Right Way.
|
| However if your way of doing things aligns with its
| unique value proposition, such as by requiring many
| people to collaboratively turn simple lists into
| confusing lists, that is bad.
|
| If you lean into what Figma writes is "Working Well," you
| will create an app that looks and feels like Spotify.
| That is what I am saying. It's on Figma.
|
| This isn't a fringe opinion by any means. SAP users get
| the most success from conforming their business to the
| way their SAP vertical solution says to do things. Git is
| also opinionated.
|
| Jira had an opinionated way of working, Agile is a
| manifesto for how people should do stuff. One task,
| exactly one assignee is really radical! You can go and
| read about Jira and Asana saying "no" when people ask to
| allow multiple assignees. Trello got rid of that, assign
| as many people to a card or task as you'd like, it's less
| opinionated, and in my opinion, it's an inherent flaw.
| And woe be onto people who use Trello, that is telling me
| right away that they are going to be slower than Jira and
| Asana users.
|
| > Figma doesn't address the entire picture yet
|
| The core dynamic they provide software for - and this is
| just as true of Google Docs and Sharepoint - is that
| BigCo employees need to touch things and get credit.
| Every BigCo I've worked with, without fail. There are
| like 10 people on meetings, and 9 people don't do
| anything but they use the stuff they touch and the
| calendar entries as collateral in their performance
| reviews.
|
| Adobe dodged a huge bullet with this one.
| arathis wrote:
| What the hell are you talking about?
| weebull wrote:
| None of the things you've highlighted have ever, as a
| user, registered with me. What I want from a music app UI
| is a good search function, playlists, and then it's
| really down to content, content, content.
|
| For an app like that I just need the UX to be "good
| enough".
| gibbitz wrote:
| I don't like spotify's UX much either, but I don't blame
| my hammer for the lopsided chairs I built. Plenty of
| crappy UIs were designed in Adobe Photoshop before Sketch
| came around and introduced tooling better suited for UX
| mockups. It's not the tool it's poor product and
| experience development you're complaining about.
| tanepiper wrote:
| Google Maps is the worst for this - the only application
| that has nearly killed me several times.
| aliston wrote:
| Wow, I hadn't thought about it through that lens exactly,
| but you are 100% right. Virtually everyone in large
| organizations (engineers, PMs, designers) are
| incentivized to launch things that align with their end-
| of-year performance goals. Those goals are sometimes at
| odds with the best overall customer outcome.
|
| I hadn't thought about figma specifically as being a
| symptom. I'm sure some organizations use it effectively,
| but I can see how it might spiral out of control to
| result in an "I'm helping too" sort of ethos, with a poor
| net outcome.
| olau wrote:
| If you read The Design of Design Fred Brooks talks about
| the perils of trying to have multiple people design
| something.
| parentheses wrote:
| I think this shows that you don't fully understand UI/UX
| and its importance/role in modern software creation.
| Moreover, you're conflating your opinions about Spotify
| with an industry. This would explain what I consider to be
| an mis assessment of the situation.
|
| As someone close to UX my entire life, Figma is a well
| positioned and useful app that has no decent substitute on
| the Adobe side. It has market share and potentially a huge
| data moat giving them a leg up on the "AI Designer"
| problem. Now more than ever, it is worth a lot.
| patternMachine wrote:
| Remarkably ignorant comment, and bitter too. You might as
| well blame MS Word for all the poorly written books out
| there.
| obmelvin wrote:
| The lowest estimate I see for Figma's ARR is $200m, so to
| suggest that even $500m is a high valuation is just
| untethered from the facts
| IAmGraydon wrote:
| Yes, but Adobe was going to buy them at 100x revenue.
| Thats quite insane.
| obmelvin wrote:
| I never questioned that 20B was high. It's also important
| to keep in mind that Adobe has failed for years with xD -
| so the value to them is quite different than it would be
| to almost any other purchaser
|
| The poster clearly has an axe to grind with Figma and
| anyone who is involved with UX decisions at most
| companies. Being mad at Spotify doesn't mean Figma is
| worth around 1 years of ARR (assuming they met their 2023
| growth)
| tragicfootball wrote:
| I agree the problems you've mentioned here, but I don't
| think it's because of Figma or any tooling.
|
| It's How Capitalism Works(tm)
| wildpeaks wrote:
| You might be confusing it with something else: Figma is
| merely for prototyping and designing, it's not the
| application that is shipped to end users (so it's like
| blaming the bugs of an app on its photoshop mockup).
| matt_s wrote:
| Yeah usually the step kids aren't allowed to talk to each
| other until after the ceremony. In fact it might be illegal
| for the two companies to do anything regarding the merger
| until the transaction is concluded. That is when you'll see
| the HR, Marketing, Sales, and Legal teams have layoffs
| because typically post-merger those areas don't require
| duplicate teams.
| krsdcbl wrote:
| As a graphics designer of almost 20 years i have to heavily
| agree. Firefly is nice for drafting and dabbling with stuff
| that once would've been served by stock sites, but aside
| picking a few demo images or making some abstract pattern
| backgrounds here and there, this has close to zero overlap
| with the UI/UX into development & design system management
| process Figma serves. It's almost like saying the Bing bot
| eats away at Laravels user base.
|
| As a personal aside: I'd like to commend the initial push you
| guys did with XD. While Figma was still out of my scope back
| then, and XD played a major role for me in transitioning away
| from oldschool Photoshop or Indesign mockup processes into a
| modern workflow that integrates with my dev team and focuses
| on component & design token centric thinking.
|
| Figma may have left XD thoroughly in the dust by now, and i
| honestly couldn't be happier that the merger won't happen,
| seeing how Adobe has been committed to absolutely dismantling
| the UX of Photoshop to the point of it only remaining
| installed on my workstation because Affinity Designer still
| lacks some core feature parity - but in its earlier days XD
| has been absolutely crucial to the development and
| modernization of my whole thinking and workflows!
| chefandy wrote:
| Curious: what do you find missing in the affinity stuff? I
| see a bunch of people referring to it generally lacking
| 'stuff' but I'm curious about the sort of stuff it lacks.
| Maybe my use case won't be impacted much.
|
| I'm grandfathered in with the introductory CC pricing but
| there aren't too many threads left in the rope anchoring me
| to that. I rarely do print design anymore so InDesign isn't
| the huge sell it used to be, and photoshop is just annoying
| me more each day. If it weren't for illustrator, I'd
| probably be gone already, and inkscape just doesn't cut the
| mustard for that stuff... the type tools alone in
| illustrator keep me there. Audition suits me way better
| than audacity but I don't do anything remotely intensive
| enough with sound to warrant a hundreds-of-dollars a year
| subscription.
| virtualritz wrote:
| Alpha channel/mask handling still sucks in Affinity and
| keeps sucking.[1]
|
| For me this is already yet another app I paid for that is
| on the way to the famous 'enshittification'.
|
| It's been years since I saw it mentioned in the Affinity
| forums first. And still a workflow so essential hasn't
| been addressed by the devs.
|
| [1] https://forum.affinity.serif.com/index.php?/topic/187
| 070-alp...
| 75th wrote:
| The Affinity apps being slow to adopt improvements has
| nothing to do with "enshittification". They're not
| actively doing user-hostile stuff for the sake of their
| stock price, or anything in that ballpark.
|
| The fact is that different things are "essential" to
| different users. Whenever they ship a new feature, some
| users are like "I wanted this!" while many are like
| "Still not shipping what we're asking for!"
|
| I do think Affinity should pick up the pace (and they
| maybe have, a tiny bit, since V2?) and address recurring
| forum topics more openly. But they're not "enshittifying"
| their apps, they're just not doing what some people wish.
| chefandy wrote:
| There's also a tradeoff between implementing features and
| controlling stability that Adobe regularly gets wrong.
| Show me a professional-- supposedly their target
| demographic-- that would prefer to have the latest whiz
| bang sloppy neural network feature or some cockamamie 3D
| bolt-on before fixing their huge list of shitty bugs.
| Arcanum-XIII wrote:
| To be honest it took a long time in Photoshop to have
| something as good as it is now. Masking is the bane of my
| existence when I have to do it (but I'm only an amateur,
| so, not often).
| chefandy wrote:
| Totally true, but that doesn't change the cost/benefit
| ratio of actually using the product for professional
| work. Masking is one of those fundamentally necessary
| tools for efficiently making professional looking photo
| composites and even more so for regular graphic design
| type work. Doing hobby work it would definitely be less
| of an issue.
| Springtime wrote:
| Affinity has various workflow interrupting issues and
| missing features, from things Adobe figured out 20 years
| ago. And to be clear, I'd _love_ Affinity to succeed at
| being a more serious competitor.
|
| Just a handful from one notes file:
|
| - No percentage document scaling drop-down option,
| despite featuring some uncommonly used units for design
| work. Instead it's hidden as a non-discoverable feature
| where you enter a percentage in the pixel field and it
| auto-converts to that absolute pixel value in-situ...
|
| - Re-opening a document doesn't restore the state of
| opened/closed groups in the layer panel
|
| - Lack of keyboard navigation for UI dialogs
|
| - Lack of smart objects equivalent (only workaround is
| placing pre-existing documents).
|
| - Can't paste clipboard contents directly as mask. In PS
| this is trivial using quick masks and the way they handle
| masks in general. Brought up in topics as old as 8 years.
| Agreed with sibling that masking needs love.
|
| - Up until v2 (afaict) there was no way to disable layer
| auto select for the move tool
|
| - Default zoom when opening documents can't be set to
| 100%
|
| - Only has binary layer lock option, rather than separate
| move/edit/etc locking
|
| - Lack of blend/interpolation of vector paths feature
| (another old and popular requested feature Adobe has had
| for decades)
|
| - Have experienced random crashes for simple actions
| (opening menus, preferences, pressing warp transform,
| dragging layers).
|
| - Vector node editing takes a dive in speed after just a
| dozen paths in a single layer. Only workaround is using
| multiple paths instead.
|
| The list goes on. That said Affinity is usable if you
| don't mind dozens of little things that have been ironed
| out and included for a long time in PS. And to be fair,
| it's very fairly priced as such.
| c0nsumer wrote:
| I really, really, really want to use the Affinity suite
| for more stuff, but just the other day when I was trying
| to knock up a basic drawing of something that exists in
| real life (a bicycle frame) I found that Designer
| couldn't draw a line of X length at N angle. It just...
| didn't have the option.
|
| All I wanted to do was draw a few lines of given lengths
| and angles and join their ends. Then overlay another set
| of the same in different colors so I could see how the
| two groupings compared visually.
|
| But... I couldn't.
|
| That's such a fundamental part of Illustrator that I
| guess I'll be going back to it.
| IAmGraydon wrote:
| > Adobe has been committed to absolutely dismantling the UX
| of Photoshop
|
| Tangential, but as a user of PS for 25 years who has
| experienced their UX changes since version 4, I'm curious
| what you mean by this.
| exodust wrote:
| I think they meant "XD". They must have since the UX of
| Photoshop has not been dismantled in any way, shape or
| form.
| herdcall wrote:
| How is/was Figma so superior to XD exactly? I used to work
| with XD and briefly also used Figma, but never really liked
| it (seemed like a crude version of XD in a way), so never
| understood all the Figma rage. Genuine question, not
| challenging the view at all. The only pluses I saw for Figma
| over XD were that it was perhaps easier to collaborate and
| didn't need installation (because it is web based).
| 627467 wrote:
| In my view the fact that figma has been built for realtime
| collab just places it on totally different league. It's
| like office vs gdocs. It tool Microsoft years (a decade?)
| To catch-up and accept that most people collab online one
| way or the other
| puppymaster wrote:
| yep. Figma's 'workflow' has become an api in itself. In
| order to compete everyone has to match the flow
| PeterCorless wrote:
| +1 this. Website design has become an increasingly
| iterative, collaborative process inside companies. You
| can't just launch a new website and surprise your team.
| People need to annotate comments, and constant iteration
| is the name of the game. Design, solicit feedback,
| integrate, iterate, repeat.
|
| There's also a lot of work needed up-front on responsive
| design (as opposed to it being an also-ran or
| afterthought), and a move away from older typical
| WordPress-oriented static designs to modern dynamic
| JAMstack-oriented development methodologies.
| exodust wrote:
| > Design, solicit feedback, integrate, iterate, repeat.
|
| Except people in a typical company who might provide
| quality feedback on the new website, do not want to
| "browse Figma". They want an actual website to view - dev
| site or the actual new live site.
|
| > "You can't just launch a new website and surprise your
| team."
|
| Yes you can. Nothing beats launching a new site to
| motivate quality feedback. If you expect feedback to
| arrive soon after launch, you can use this to your
| advantage.
|
| If you like the sound of crickets, share a link to Figma
| and ask people for feedback. Designers and developers
| will respond, others like sales and non-technical staff
| often won't. Why? Because people prefer the security of
| their web browser's familiar reference point when
| assessing a website. As opposed to browsing an app that
| gives them a special window to a slippery canvas where an
| impression of the website is found.
| wryanzimmerman wrote:
| That's why you send them the link to the prototype, which
| opens in their browser, not the figma link.
|
| That's like half the point of prototyping software vs
| graphic design / illustration software!
|
| Non-designers want to see "the site" open in their
| browser and be able to click through the pages, instead
| of use some design app--that's like half the point of
| figma.
| didibus wrote:
| Microsoft Word (pre-office-365 days) VS Google Docs
| basically.
| berkes wrote:
| Anecdotally, but at least three studio's and designers I work
| with switched to Figma because "it became Adobe". They made
| the switch because Adobe gave it some sort of "stamp of
| approval". From two, I'm certain they'll never go back to XD
| and/or illustrator. One, I'm not too sure because all their
| onboarding, libraries and education is around "adobe
| products".
|
| So, at least from N=3, I dare say that the attempted merger
| only made the existential problem for Adobe worse.
| jahewson wrote:
| Adobe's market cap is $272bn. They're not sweating about $10bn
| vmatsiiako wrote:
| Almost 5% of market cap is a very significant amount.
| ska wrote:
| > Gen AI and Adobe Firefly are the new rage
|
| Gen AI isn't going to solve a number of the problems a system
| like Figma are used for today - not in this generation or
| foreseeable next ones. It may be a shiny new ball to chase but
| it's not going to make Adobe's problem in the area go away (if
| they still care).
| mrandish wrote:
| > I wonder if Adobe is secretly happy about this.
|
| I think they probably are. I follow Adobe closely and when the
| acquisition was announced I was pretty skeptical it would be
| net good for Adobe in the long-run. The problem wasn't the idea
| of buying Figma, it was the very rich price being paid. Adobe
| has a history of not doing a lot of big acquisitions (for it's
| size and massive cash position). When it does acquire big,
| Adobe is mostly strategic and a "value shopper", meaning they
| generally don't pay extremely high prices bid up by frothy
| auctions. This means Adobe must walk away from a lot of deals
| we never hear about over price. That's why the Figma deal
| struck me as so unusual.
|
| In the >year since the deal was announced, it's started to look
| even less plausible to me. Despite being required to pay a
| large break-up fee, I suspect, Adobe's management is relieved.
| karmasimida wrote:
| One thing we could all agree is 20B for Figma is too
| expensive considering how the market has shifted.
|
| Figma is still solid company/business, but Adobe probably
| could acquire them much cheaper in today's market.
| tekkk wrote:
| Google was too expensive for Yahoo multiple times. You
| should look this from a bigger time scale. Sure they were
| paying a lot of goodwill on the deal. But if, down the
| road, Figma now starts their trajectory to become an equal
| to Adobe it sure would have been nice to capture that
| market all to yourself. Like Nvidia or TSMC.
|
| For the record, I am happy this fell through since it's
| clear Adobe needs competition to stop it abusing its market
| position.
| intelVISA wrote:
| You're suggesting there's a lunch to be eaten? I'm
| getting kinda famished...
| edgyquant wrote:
| Yes this is exactly why governments should not allow
| acquisitions like this
| ksec wrote:
| >* Startup valuations have fallen. Ignoring regulatory
| concerns, a new acquisition deal today would be cheaper.
|
| Figma reached $400M in 2022 and on its way to hit $600M this
| year 2023. For perspective they reached $200M in 2021, and $75M
| in 2020. That is pretty impressive growth rate.
|
| Straightly on a revenue / market cap, Adobe makes $20B Revenue
| and values at $270B. That is 13.5x multiple. If we expect Figma
| to hit $1B mark by 2025, they could be worth $13.5B. i.e Even
| with today's market, I dont think it is hard to do an IPO with
| that $13.5B valuation.
|
| And if Adobe were to acquire a listed company with 30% premium,
| that is $17.5B. Not that far off from $20B. Now that Figma has
| an extra $1B cash flow, I hope they spend it wisely and
| continue to do well. So while some may argue this is bad for
| employees and investors. I dont think it is that bad.
|
| I do hope they consider IPO, as I am slightly worried the
| window of opportunity may be gone when market turns.
| low_common wrote:
| You don't work in the space, you don't work for either company,
| you don't know what you're talking about. How is this the top
| comment here?
| rapht wrote:
| I don't know about Adobe's motives, but it sure looks like
| despite the "we ended the process by mutual agreement" talk,
| Adobe somehow walked away... otherwise they wouldn't let $1bn
| out of the window - unless they actually signed something along
| the lines "we will take responsibility if antitrust throws the
| deal away" but that would be quite unlikely in such a high
| profile transaction.
| lucubratory wrote:
| >unless they actually signed something along the lines "we
| will take responsibility if antitrust throws the deal away"
| but that would be quite unlikely in such a high profile
| transaction.
|
| This is absolutely standard in M/A. Part of the risk of
| accepting an acquisition offer is that you're essentially
| putting your company's strategic future on hold, and if what
| you're doing that for falls through for any reason (including
| regulatory oversight) you want compensation for at least some
| of the lost time. Specifically, you won't even sign the
| acquisition contract without such a guarantee; the only real
| question is price.
| wentin wrote:
| I see where you're coming from, but there are a few critical
| points about the Adobe-Figma deal that you got wrong. (I am an
| ex-Adobe XD employee)
|
| When Adobe announced its plan to acquire Figma in September
| 2022, the timing was actually at the valley of startup
| valuations. The market was really down then. Since that time,
| the market has actually warmed up, not cooled down. This means
| if Adobe were to negotiate a deal now, it would likely cost
| them even more than what they agreed upon last year. Contrary
| to what you said.
|
| Speaking of the negotiation, I think Adobe dropped the ball.
| They agreed to a whopping 20 billion dollars, which in my view
| was four times too high given Figma's real valuation at that
| time, especially considering the low market (I wrote about how
| I calculate this 5B valuation in https://typogram.co/build/on-
| adobe-acquiring-figma/). Then, with the deal being halted by
| regulators, Adobe still had to pay the full breakup fee, within
| just three days! It's kind of laughable how poor their
| negotiation strategy was.
|
| About Adobe's product strategy, there's a bit of confusion.
| Firefly, their new thing, isn't even about UX tooling; it's
| more focused on creative AI. The real product that is actually
| relevant here is Adobe XD, which Adobe has just put on
| maintenance mode (since at least September). a change I noticed
| on their help page as recently as this September
| (https://helpx.adobe.com/support/xd.html#troubleshooting). This
| move is a huge strategic mistake. It's a clear loss of momentum
| for Adobe in the UX tooling space, making them even less
| competitive against Figma. Meanwhile, Figma hasn't missed a
| beat and continues to surge ahead.
| vl wrote:
| I wonder if Figma will have to pay taxes on 1B they are getting
| as the fee.
| cj wrote:
| Will probably be an expense on Adobe's books and income on
| Figma's. Lowering Adobe's tax and potentially raising
| Figma's.
|
| Not sure about this exact scenario, but the government taxes
| legal settlements. Not sure why they wouldn't tax this.
|
| Will definitely lower Adobe's tax bill.
| sam1r wrote:
| Hmph, I was more under the assumption that this was more of a
| "We're going to get into Adobe's space" and become a competitor
| to drive up our valuation.
|
| [Pure speculation]
| quitit wrote:
| I agree but for a slightly different reason.
|
| UX is going to get a shake up from AI. We're already seeing a
| bit of the new paradigm of on-demand UI/UX with Gemini (and the
| various me-too demos). Both Figma and Adobe are now vulnerable
| to disruption in this space. Adobe can use the time to ape
| Figma while flexing their rather good AI expertise.
| gibbitz wrote:
| I wonder about the UX created by AI when we start delegating
| browsing to AI. The major search engines already are looking
| to lean on AI and we complain about ads enough that it's
| clear we see browsing as a chore. It's only a matter of time
| before the web is written in a new bytecode that is meant for
| AI only. Turtles all the way down...
| quitit wrote:
| I think this is what the "Digital Assistant" will become.
| At the moment we craft some kind of prompt then scour the
| results which are largely book-like representations of
| information.
|
| Per your suggestion, it would be logical that alongside our
| usual text-driven sites we have digital information
| repositories for AIs to query information rather than
| trying to glean it from the text-driven webpage. Google
| Knowledge and Siri Knowledge are both implementations of
| this idea, but I assume it will grow to something that is
| more general purpose, so any AI could access it. Then
| extend that to all manner of services, such as bookings,
| tickets, shopping, etc. That's where the real turtles are.
| maroonblazer wrote:
| I dunno. I work with a lot of designers and there's _so much_
| substantive back and forth in terms of clarifying goals,
| objectives, understanding design choices, and business
| priorities. I.e., there 's a ton of nuance that is uncovered
| and deconstructed in those conversations. I'm skeptical that
| AI, at least in its current and foreseeable form, can fill
| those shoes in any meaningful way.
|
| I liken it to engineers who respond to the threat of AI
| making them obsolete with "Half my job is clarifying
| requirements and/or changes in priorities...can Copilot do
| that?" I think it's the same for UX/UI/Design.
|
| I say that as a very vocal supporter of this latest
| generation of AI. Both personally and professionally it's
| upped my game significantly.
| quitit wrote:
| Oh don't get me wrong. You're 100% right - but this
| provides a level of disruption that would make the Figma
| buy out not as competitive as originally imagined. Neither
| are, of course, in the on-demand UX space, but both will
| need to be. Until then AI concept building is coming, this
| being the idea of freeing the designers from repetition and
| ground work, while speeding up concept development. (I.e
| pretty much what copilot is for coding.)
| turtle_ wrote:
| Having gone through one major acquisition, my experience was
| that legal put a huge block on any technical integrations and
| even meetings that might reveal ip until the ink was dried. I'm
| skeptical they started any kind of collaborative work other
| than pie-in-the-sky, "wouldn't it be cool if" type meetings
| with lawyers present.
| johannes1234321 wrote:
| Correct, till all legal things a cleared upon both companies
| must act as there were no acquisition. Only specific M&A
| teams can look deeper and plan for integration.
|
| This leads to a complicated limbo for acquired companies as
| customers consider the acquisition (buy now before new owner
| raises the price or hold out as they will cancel the product
| line?), employees are uncertain (conflicting products on both
| sides, which will continue, with which direction? Will
| yesterday's priorities still count tomorrow?) while all are
| counting their shares and make plans.
| dolmen wrote:
| As I've been involved in 3 successive acquisitions of the
| company I work for, I can tell you that no integration happens
| at all until the deal is signed. Some plans may have been draws
| at the top executive level, but that stops here. Everything is
| done under the legal department supervision and "mitigate
| risks" is the primary concern. The time before signing the deal
| is spent mostly dealing with writing the contract between the 2
| parties, not integrating.
| lloydatkinson wrote:
| > I don't work in the UI space at all
|
| > Adobe has probably captured back both mental and market share
| from Figma
|
| I agree with your initial point - only someone not in the UI
| space could make such an outlandish, and honestly deranged,
| claim.
| hawk01 wrote:
| > * Startup valuations have fallen. Ignoring regulatory
| concerns, a new acquisition deal today would be cheaper.
|
| The chances of them buying Figma this decade is lowered. I
| wouldn't be surprised if figma doubles the valuation at that
| point
| dcreater wrote:
| Wow regulators win for a change!!
| j45 wrote:
| Since due diligence can take 12-24 months, I wonder what other
| than a much lower valuation being worth it caused this
|
| Did Adobe get or figure out enough tips and tricks for their
| other products?
|
| I have used adobe a bit over the years but no relation to either
| group.
|
| That is a lot of subscription to walk away from for a company who
| is good at subscription, unless one of their parked projects was
| able to be written in webassembly.
| htk wrote:
| Sorry my melancholy but it seems that sooner or later everyone
| sells out.
| zombiwoof wrote:
| someone help me understand: Figma is a UI designer/Balsamiq like
| app worth a billion dollars?
| braum wrote:
| So will Adobe put more resources to help their pre-maturely
| abandoned XD catchup?
| epicweb wrote:
| MSFT acquisition instead..?
| Ensorceled wrote:
| I have no idea why so many people are asserting that the FTC has
| been sitting on this for 15 months.
|
| The first paragraph of the article, FROM FIGMA, says:
|
| "Figma and Adobe have reached a joint decision to end our pending
| acquisition. It's not the outcome we had hoped for, but despite
| thousands of hours spent with regulators around the world
| detailing differences between our businesses, our products, and
| the markets we serve, we no longer see a path toward regulatory
| approval of the deal."
|
| The FTC has not been slow rolling this, they have been in
| discussions. No one wants the FTC to sue unless they have too,
| especially Figma/Adobe ... it sounds like Figma and Adobe have
| finally admitted that they were not going to win this one.
| izktj wrote:
| This was a dirty dirty move by Adobe, not regulators. Insiders
| will know what I'm talking about
| wsgeorge wrote:
| Not an insider: can you share some perspective?
| mkreis wrote:
| Oh please elaborate! But I can guess that a lot of confidential
| information was shared during the due diligence and that's,
| even worse, most Figma employees already assumed it was a done
| deal and started openly sharing source code etc. with Adobe.
| 4ggr0 wrote:
| i don't use figma or photoshop products, but this makes me happy.
| dcchambers wrote:
| I don't use Figma or Adobe tools so I don't really know or care
| about this acquisition. It seems like public opinion is split -
| some saw this as a good thing and others as a bad thing for
| Figma.
|
| Who I really feel bad for is some of the early employees that
| just saw life-changing amounts of money vanish in the blink of an
| eye.
|
| I can't imagine how gutted they must be headed into the Holidays.
| Obviously that value isn't truly _gone_ - but it certainly
| changes things, and I am sure many of them did not plan for this.
| N3cr0ph4g1st wrote:
| Good fuck em. They dangled this deal in my face why I was
| interviewing with figma and at least the people I dealt with
| were so sure it's a done deal.
|
| Lame
| bastardoperator wrote:
| I just feel bad for Figma staff today. Y'all make a great
| product, keep your head up!
| orf wrote:
| $1 billion termination fee split between 900 employees = happy
| times.
|
| I'm sure that will happen.
| knicholes wrote:
| Give everyone $1.1M and see a bunch leave because they don't
| need to stay to earn money anymore.
| orf wrote:
| Good? Or is a company only supposed to benefit the founders
| in that way?
| corytheboyd wrote:
| Not a fun day to be a Figma employee. It's all "yeah fuck tech
| monopolies!" until it's you who will receive a fat payout. Can't
| say I'm not playing the same game, hoping for a similar outcome.
| I can only _dream_ of a $20b acquisition.
| bagels wrote:
| Yeah, that's my sentiment too. I have no stake in this
| transaction at all. It was okay for Whatsapp, Instagram, Waze,
| etc. employees to get a payday, but not Figma employees.
| vlovich123 wrote:
| I think this is great. Figma gets a free undiluted infusion of 1B
| cash. I'm surprised break-up fees aren't negotiated as an
| investment instead of a pure cash transfer. Sure it may have
| impacted company focus, it didn't impact their revenue that much
| (1.5x growth vs 2x growth in previous years although that could
| have also been caused by an adverse economic climate with sales
| slowing across many companies and industries). The one-time 1B
| infusion puts their revenue growth quite a bit higher for 2023
| than they would have had organically I suspect (4x growth vs best
| case of 2x). If Figma fixes their sales trajectory in 2024 this
| bodes extremely well for them. They do need to have a better
| story about generative AI which is a real thing in their space
| (e.g. wireframe -> mockup automatic conversion, wireframe
| construction assistants, etc etc). Will be interesting to see if
| they build that in-house or via acquisition.
| gkoberger wrote:
| It could be negotiated as an investment, but that only benefits
| Adobe. Figma wouldn't want it (would you want your biggest
| competitor to be an investor? they'd have information and
| leverage you wouldn't want them to have), and it defeats the
| purpose of a break-up fee (Figma negotiated for it because they
| didn't want to spend a year of their lives focusing on
| something that would benefit their competitor if it's all for
| nothing... Adobe gained a year, has a ton of information, and
| distracted Figma).
| theultdev wrote:
| And in reality, Adobe actually lost progress on XD and Figma
| has come out with an incredible amount of features this year.
|
| Now Figma has an extra billion for development and Adobe has
| to start back up the thing they couldn't catch Figma with in
| the first place.
|
| It was pretty much a win/win for Figma regardless of outcome.
| Though this outcome is a win for Figma and it's users.
| matwood wrote:
| > And in reality, Adobe actually lost progress on XD and
| Figma has come out with an incredible amount of features
| this year.
|
| Features and free advertising. Many people knew of Figma,
| but now everyone knows of Figma. It's the tool that was
| good enough to scare Adobe into paying 20B and stopped by
| regulators.
| vlovich123 wrote:
| Being an investor doesn't necessarily entitle you to
| information/leverage. For example, Apple earlier had plenty
| of board members from competitors & they would excuse
| themselves from certain discussions. Similarly, an investment
| doesn't guarantee you a board seat. So there's all sorts of
| ways to structure things and it's all a negotiation (e.g. the
| break up fee could have been a 2B investment instead or
| something).
|
| Anyway, I agree this turned out phenomenally well for Figma
| and if I were an employee I'd be really happy about how this
| all turned out both for Figma and the industry (modulo the
| delay in cashing out).
| invig wrote:
| As a conflicted board member you would have access to the
| information, you just wouldn't participate in the
| conversation / decision making.
| kinnth wrote:
| I 100% agree. That space needs competition and alternatives to
| the Adobe monopoly.
| mathattack wrote:
| Making it an investment could be tripped up by whatever might
| trip up a merger. It's also more difficult to value the
| investment. (How much equity should they give up? Same
| valuation as the implied purchase?)
| vlovich123 wrote:
| Maybe? I haven't heard of any regulatory oversight of
| investments, only mergers. Do you have any links I can read
| up more on this?
|
| As for valuation, same as valuations a purchase or how they
| get valued whenever there's a round of investment (basically
| you do a sophisticated argument over value using comparables
| as a way to try to establish a baseline). The equity
| purchased would equal how much cash gets infused vs the
| valuation established by the deal.
| 015a wrote:
| Fun fact: Figma's ARR in 2022 was around $400M. That $1B cash
| infusion could be invested in treasuries with an ARR of ~$50M;
| this isn't just a liquidity infusion of a billion dollars, it
| increases their net income by like 10%, basically free of
| charge.
| hn_throwaway_99 wrote:
| You're confusing revenue with net income.
|
| Plus, if the best that Figma can do with a billion dollars is
| just invest it in Treasuries (and I'm not saying that's the
| case), then they should just give it to their shareholders
| and see if they can get a better return. I only point this
| out because many people are often confused by the effects of
| higher interest rates, e.g. "Why did this company lay off all
| these people when they're still profitable?" Your example
| highlights the reason why perfectly - if you're a company
| with a billion dollars of investment and the best profit you
| can muster is $50 million a year, you're a great business if
| Treasuries are only paying 1%, but when they're paying 5% you
| should just basically close up shop as people can get the
| same return just sticking their money in Treasuries.
| habitue wrote:
| I think they're saying net income because they're assuming
| there wasn't any cost for it. But they do have to pay taxes
| on it, and the lawyers and executives time spent on trying
| to make the deal work did cost something. Probably much
| higher margin work than their core business though.
|
| If only you could repeatedly negotiate and then recover
| breakup fees as a business..
| hn_throwaway_99 wrote:
| > I think they're saying net income because they're
| assuming there wasn't any cost for it.
|
| The issue is that they conflated ARR, which obviously
| does have a cost, with the largely "free money" from
| their breakup fee.
| kuldeepfouzdar wrote:
| Point is adding $1B on the balance sheet is definitely a
| plus. How figma uses it is up to them. But yes, companies
| don't use all the cash right away and do put some of it
| into short term investments.
| paulddraper wrote:
| > I'm surprised break-up fees aren't negotiated as an
| investment
|
| That would be very awkward (and even dangerous) to have a
| competitor as an investor.
| drexlspivey wrote:
| As opposed to them buying 100% of the company?
| paulddraper wrote:
| Correct
| gedy wrote:
| Very true, but it's interesting the Figma CEO sounds
| disappointed, which feels like the game plan has been to be
| acquired and pay investors.
|
| Adobe is the biggest player in the space, so if denied, might
| put a damper on future acquisition price.
| lovegrenoble wrote:
| For the best
| wentin wrote:
| I'm an ex-Adobe employee who worked on Adobe XD, which is
| basically Adobe's answer to Figma. when Adobe decided to buy
| Figma, my first reaction was pretty much "Wait, what?" I wrote
| down my initial thoughts about it[^1], it felt like a losing
| situation all around - for Adobe, Figma, and all the designers
| out there. The only folks who really seemed to win were Figma's
| investors.
|
| Now, let's talk how bad the breakup deal is for Adobe. You've got
| Elon Musk buying Twitter for a massive 54 billion, with a breakup
| fee of 1 billion if it doesn't go through. But then, there's
| Adobe, buying Figma for 20 billion, and they also get slapped
| with a 1 billion breakup fee. Musk tried to back out of his deal,
| no real reason, and didn't want to pay the fee. But Adobe? Their
| deal gets killed by regulators, and they still have to pay the
| full 1 billion. Makes you really think about the decision-makers'
| negotiation at Adobe, do they work for Figma?
|
| Before the deal was sealed, Figma didn't start integrating their
| tech with Adobe's. However, Adobe put XD on the maintaince
| mode[^2], losing market share since then. Yes, XD wasn't as cool
| as Figma, but it had its sizable share of big corporate users.
| The data backs this up[^3].
|
| The whole fallout from this? For the design community and Figma,
| it's kind of a win. The CEO of Figma is pretty well-respected for
| how he treats his team. That 1 billion from Adobe might help out
| the Figma folks who got left in the lurch. Morale over there is
| still pretty high. But Adobe stopping development on XD? I think
| that was a misstep. I suspect they might have done that to please
| the regulators. Now put the team back together and continue
| development? That takes time for big machine like Adobe, spoken
| from my past experience. But I am happy XD get to live on, at
| least hopefully.
|
| Here are the references I mentioned:
|
| [^1]. My initial thoughts on Adobe acquiring Figma:
| [Typogram](https://typogram.co/build/on-adobe-acquiring-figma/)
|
| [^2]. Adobe XD Enters Maintenance Mode:
| [Typogram](https://build.typogram.co/p/adobe-xd-enters-
| maintenance-mode)
|
| [^3]. Design Tool Survey Report: [Survey
| 2022](https://uxtools.co/survey/2022/toolkit), [Survey
| 2023](https://uxtools.co/survey/2023/toolkit)
| tomgeoco wrote:
| FYI, the 2023 version of the design tools survey was published
| recently: https://uxtools.co/survey/2023/
| wentin wrote:
| Thanks for letting me know! I added the extra link!
| edwincoronado wrote:
| Good.
| EMCymatics wrote:
| Probably good for both parties, better for Adobe.
| low_tech_punk wrote:
| Pure speculation: Microsoft is bidding against Adobe
|
| 1. Figma could benefit from the AI infrastructure from Microsoft
|
| 2. Figma has outgrown the design tool genre, and is becoming
| productivity/collaboration platform and low-code no-code app
| builder. Adobe's roadmap seems misaligned
|
| 3. Regulation: Figma is big enough and similar enough to Adobe XD
| and Illustrator
| himaraya wrote:
| > The decision by Adobe and Figma to spike their $20 billion
| merger on Monday dented the imminent dream of startup riches for
| Figma investors and employees. But Figma's business is still
| growing quicker than that of most mature startups, potentially
| putting it in position for an initial public offering in 2025 or
| later. And the billion-dollar breakup fee from Adobe will
| strengthen Figma's already robust balance sheet.
|
| > The design software firm expects to finish this year with over
| $600 million in annual recurring revenue, an increase of more
| than 40% over the past year, people familiar with the matter
| said. The San Francisco-based company has also been generating
| cash for a few years, the people said. That financial picture
| likely makes it one of the best-performing late-stage private
| tech companies, particularly in a year when many firms have
| struggled with sagging growth rates as corporate clients have cut
| their software spending.
|
| https://www.theinformation.com/articles/figma-grew-fast-even...
| radium3d wrote:
| _breathes a sigh of relief_
| mercurialsolo wrote:
| What about this playing a role?
|
| Is the role of anti-trust, big tech regulation and regulatory
| fees playing a bigger role here?
|
| Is the era of AI more in favour of say both Figma / Adobe
| competing vs collaborating - similar datasets?
|
| https://edition.cnn.com/2023/12/19/tech/google-play-store-se...
| GJR wrote:
| Adobe has dodged a bullet; Figma was ridiculously overvalued.
| Brosper wrote:
| I think it's good for us users. We need more companies to fight
| with each other. We can't sell everything to one company.
|
| The EU is doing great work, in my opinion.
| tamarlikesdata wrote:
| I don't get this. Any designer knows that Figma is the best tool.
| maniflames wrote:
| It's not about the quality of the tool but the fact that
| regulators will most likely think that this merger will violate
| anti-trust laws and lawyers from both companies can't argue for
| why this isn't the case
| lazyinterface wrote:
| crazy
| kmdupree wrote:
| Probably better for the consumer.
| guerrilla wrote:
| Good. The last thing this worlds is new mergers. It's starting to
| look dystopian out there.
| SandroG wrote:
| dumb question: why do two American companies need an approval
| from the UK to merge?
| seanpquig wrote:
| Anyone know how this outcome is affecting Figma employees? I can
| imagine it's a huge letdown waiting 1.5 years for a big liquidity
| event and having it evaporate. Do employees see any benefit from
| that $1B termination fee?
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